Phosphorylation is one of the major post-translational mechanisms by which the activity of transcription factors is regulated. We have investigated the role of phosphorylation in the regulation of nucleic acid binding activity and the nuclear translocation of WT1. Two recombinant WT1 proteins containing the DNA binding domain with or without a three amino acid (KTS) insertion (WT1ZF + KTS and WT1ZF - KTS) were strongly phosphorylated by protein kinase A (PKA) and protein kinase C (PKC) in vitro. Both PKA and PKC phosphorylation inhibited the ability of WT1ZF + KTS or WT1ZF - KTS to bind to a sequence derived from the WT1 promoter region in gel mobility shift assays. The binding of WT1ZF - KTS to an EGR1 consensus binding site was also inhibited by prior PKA and PKC phosphorylation. We also demonstrate the RNA binding activity of WT1, but this was not altered by phosphorylation. PKA activation by dibutyryl cAMP in WT1-transfected cells resulted in the reversal of WT1 suppression of a reporter construct. Although WT1 protein is predominantly localized to the nucleus, this expression pattern is altered upon PKA activation, resulting in the cytoplasmic retention of WT1. Accordingly, phosphorylation may play a role in modulating the transcriptional regulatory activity of WT1 through interference with nuclear translocation, as well as by inhibition of WT1 DNA binding.