Protein phosphatase 5 is involved in the regulation of kinases and transcription factors. The dephosphorylation activity is modulated by the molecular chaperone Hsp90, which binds to the TPR-domain of protein phosphatase 5. This interaction is dependent on the C-terminal MEEVD motif of Hsp90. We show that C-terminal Hsp90 fragments differ in their regulation of the phosphatase activity hinting to a more complex interaction. Also hydrodynamic parameters from analytical ultracentrifugation and small-angle X-ray scattering data suggest a compact structure for the Hsp90-protein phosphatase 5 complexes. Using crosslinking experiments coupled with mass spectrometric analysis and structural modelling we identify sites, which link the middle/C-terminal domain interface of C. elegans Hsp90 to the phosphatase domain of the corresponding kinase. Studying the relevance of the domains of Hsp90 for turnover of native substrates we find that ternary complexes with the glucocorticoid receptor (GR) are cooperatively formed by full-length Hsp90 and PPH-5. Our data suggest that the direct stimulation of the phosphatase activity by C-terminal Hsp90 fragments leads to increased dephosphorylation rates. These are further modulated by the binding of clients to the N-terminal and middle domain of Hsp90 and their presentation to the phosphatase within the phosphatase-Hsp90 complex.