To determine whether the receptor-like protein-tyrosine phosphatase, RPTP alpha, which is widely expressed in both the developing and adult mouse, is regulated by phosphorylation, we raised antiserum against a C-terminal peptide. This antiserum precipitated a 140-kDa protein from metabolically 35S-labeled NIH3T3 cells. Using this antiserum, we showed that endogenous RPTP alpha is constitutively phosphorylated in NIH3T3 cells, predominantly on two serines, which we identified as Ser-180 and Ser-204, lying in the juxtamembrane domain. 12-O-tetradecanoylphorbol-13-acetate (TPA) stimulation of quiescent NIH3T3 cells rapidly increased phosphorylation of Ser-180 and Ser-204. Purified protein kinase C (PKC) phosphorylated bacterially expressed RPTP alpha at Ser-180 and Ser-204. When wild type and S180A/S204A double mutant RPTP alpha S were transiently expressed in 293 human embryonic kidney cells, TPA stimulated phosphorylation of wild type but not of double mutant RPTP alpha. PKC down-regulation following prolonged exposure to TPA diminished TPA-stimulated RPTP alpha phosphorylation. Taken together, these results indicate that RPTP alpha is a direct substrate for (PKC). Examination of 293 cells expressing exogenous RPTP alpha using immunofluorescence confocal microscopy showed that RPTP alpha exists predominantly in two subcellular compartments: in dense intracellular granules or dispersed within the plasma membrane. TPA treatment caused redistribution of some intracellular RPTP alpha to the cell surface, but this did not require direct phosphorylation of RPTP alpha at Ser-180/Ser-204. Our results suggest that activation of PKC by cytokines modulates RPTP alpha function in several different ways.