The heavy metal cadmium is a non-degradable pollutant. By screening the effects of a panel of metal ions on the phosphatase activity, we unexpectedly identified cadmium as a potent inhibitor of PPM1A and PPM1G. In contrast, low micromolar concentrations of cadmium did not inhibit PP1 or tyrosine phosphatases. Kinetic studies revealed that cadmium inhibits PPM phosphatases through the M1 metal ion binding site. In particular, the negative charged D441 in PPM1G specific recognized cadmium. Our results suggest that cadmium is likely a potent inhibitor of most PPM family members except for PHLPPs. Furthermore, we demonstrated that cadmium inhibits PPM1A-regulated MAPK signaling and PPM1G-regulated AKT signaling potently in vivo. Cadmium reversed PPM1A-induced cell cycle arrest and cadmium insensitive PPM1A mutant rescued cadmium induced cell death. Taken together, these findings provide a better understanding of the effects of the toxicity of cadmium in the contexts of human physiology and pathology.