Protein phosphatase-1 (PP1) is regulated by interaction with different subunits, which include several inhibitory proteins. It is also potently inhibited by several toxins of diverse origins. Recent work has identified a region near the C-terminus of PP1 (residues 274-277) whose modification was shown to moderate okadaic acid binding [Zhang et al. (1994) J. Biol. Chem. 269, 16997-17000]. In this study, the role of this region in toxin binding was explored by site-directed mutagenesis. A residue (Tyr-272) was identified whose mutation had dramatic effects on the spectrum of inhibitor sensitivity of PP1. The IC50's of a number of mutants of Tyr-272 toward okadaic acid, tautomycin, calyculin A, microcystin-LR, nodularin, inhibitor-2, and cantharidic acid were determined and compared to that of the wild-type enzyme. The sensitivity of PP1 toward tautomycin and calyculin A was markedly decreased, by as much as 3 orders of magnitude, with lesser effects on okadaic acid and nodularin, and with microcystin-LR and inhibitor-2 being the least affected. These studies show that Tyr-272 is of specific importance for the binding of these inhibitors and provide strong evidence for the postulate that these toxins all bind to a common inhibitor site on PP1. In addition, our studies show that Tyr-272 is not required for catalytic activity.