Inhibitor-2 (I-2) is the most ancient protein that selectively recognizes type-1 protein phosphatase and is phosphorylated by CDK1-cyclinB during mitosis at Thr72 in a conserved PXTP site. Pin1 is a peptide prolyl cis/trans isomerase conserved among eukaryotes that specifically reacts with proteins phosphorylated at Ser/Thr-Pro sites. We tested phospho-T72-I-2 as a substrate for Pin1 and discovered that unphosphorylated I-2 bound Pin1 with micromolar affinity and phosphorylation of the PXTP site or truncation of I-2 reduced binding 10-fold. Ectopic Pin1 coprecipitated endogenous I-2 and ectopic I-2 coprecipitated endogenous Pin1, but only in the absence of detergents, which may account for the interaction not being detected previously. Endogenous I-2 and Pin1 colocalized in HeLa cells and showed nuclear-cytoplasmic redistribution in response to cell density, suggestive of their association in living cells. Recombinant Pin1 binding to different phosphoproteins in mitotic cell extracts was modulated by I-2, and binding to individual mitotic phosphoproteins was increased, decreased or unaffected by I-2, showing that I-2 allosterically modifies Pin1 specificity. This was confirmed by mutation of Ser16 to Ala in the Pin1 WW domain that eliminated I-2 binding and abrogated I-2 effects on Pin1 binding to different phosphoproteins. A S16E mutation to mimic Pin1 phosphorylation restored binding to both I-2 and phospho-T72-I-2, indicating that phosphorylation of both proteins governs their interaction. The results reveal a novel function for I-2, and suggest phosphorylation-dependent regulation of Pin1 specificity during entry and exit of mitosis, in other phases of the cell cycle, and in multiple cell signaling processes.