A protein inhibitor of HMG-CoA reductase phosphatase activity from rat liver was purified to homogeneity. The protein was purified 4,000-fold with an overall yield of 4%. The purified protein had a molecular mass of 31 kDa. This spontaneously active protein is thermostable and acid-resistant. The protein inhibitor is phosphorylated by glycogen synthase kinase-3 and cAMP-dependent protein kinase without change in its inhibitory activity. The inhibition caused by this inhibitor on phosphatases 1 and 2A is similar to that of inhibitor-2 from rabbit skeletal muscle using hydroxymethylglutaryl-CoA reductase as substrate. The regulation properties of this inhibitor towards phosphatase 1 together with another protein inhibitor of phosphatase 2A in cholesterol metabolism are discussed.