Calcineurin is an important signal-transducing enzyme in many cell types including T lymphocytes and is a common target for the immunosuppressants cyclosporin A and FK506. The crystal structures of both calcineurin [Griffith et al. (1995) Cell 82, 507-522; Kissinger et al. (1995) Nature 378, 641-644] and a related enzyme, protein phosphatase-1 [Goldberg et al. (1995) Nature 376, 745-753], revealed that this class of serine/threonine phosphatases contain in their putative active sites a binuclear metal center formed by an Asn, two Asp, and three His residues. In addition, one His and two Arg residues lie in close vicinity of the binuclear metal centers. The importance of the binuclear metal center and its surrounding residues in catalysis by calcineurin has not been investigated experimentally. Herein, we report an efficient bacterial expression and purification system for human calcineurin alpha. Using this system, a systematic alanine-scan mutagenesis on the residues surrounding the putative active site was performed. It was found that an intact binuclear metal center is essential for the catalytic activity of the enzyme. In addition, His151, Arg122, and Arg254 also exhibited either a loss or a dramatic decrease in catalytic activity upon mutation into alanines. Interestingly, the Arg254Ala mutant retained a small but significant amount of catalytic activity toward the small substrate p-nitrophenyl phosphate, but is completely inactive toward a phosphopeptide substrate, suggesting that this arginine may be involved in the binding of phosphoprotein substrates as well as in catalysis. As all the residues in the putative active site are conserved between different eukaryotic serine/threonine phosphatases, these results should apply to all members of this family of protein phosphatases.