The immunosuppressive agents cyclosporin A (CsA) and FK 506 bind to distinct families of intracellular proteins (immunophilins) termed cyclophilins and FK 506-binding proteins (FKBPs). Recently, it has been shown that, in vitro, the complexes of CsA-cyclophilin and FK 506-FKBP-12 bind to and inhibit the activity of calcineurin, a calcium-dependent serine/threonine phosphatase. We have investigated the effects of drug treatment on phosphatase activity in T lymphocytes. Calcineurin is expressed in T cells, and its activity can be measured in cell lysates. Both CsA and FK 506 specifically inhibit cellular calcineurin at drug concentrations that inhibit interleukin 2 production in activated T cells. Rapamycin, which binds to FKBPs but exhibits different biological activities than FK 506, has no effect on calcineurin activity. Furthermore, excess concentrations of rapamycin prevent the effects of FK 506, apparently by displacing FK 506 from FKBPs. These results show that calcineurin is a target of drug-immunophilin complexes in vivo and establish a physiological role for calcineurin in T-cell activation.