The activation of protein phosphastase-1 (PP1) by insulin plays a critical role in the regulation of glycogen metabolism. PTG is a PP1 glycogen-targeting protein, which also binds the PP1 substrates glycogen synthase, glycogen phosphorylase, and phosphorylase kinase (Printen, J. A., Brady, M. J., and Saltiel, A. R. (1997) Science 275, 1475-1478). Through a combination of deletion analysis and site-directed mutagenesis, the regions on PTG responsible for binding PP1 and its substrates have been delineated. Mutagenesis of Val-62 and Phe-64 in the highly conserved (K/R)VXF PP1-binding motif to alanine was sufficient to ablate PP1 binding to PTG. Phosphorylase kinase, glycogen synthase, and phosphorylase binding all mapped to the same C-terminal region of PTG. Mutagenesis of Asp-225 and Glu-228 to alanine completely blocked the interaction between PTG and these three enzymes, without affecting PP1 binding. Disruption of either PP1 or substrate binding to PTG blocked the stimulation of PP1 activity in vitro against phosphorylase, indicating that both binding sites may be important in PTG action. Transient overexpression of wild-type PTG in Chinese hamster ovary cells overexpressing the insulin receptor caused a 50-fold increase in glycogen levels. Expression of PTG mutants that do not bind PP1 had no effect on glycogen accumulation, indicating that PP1 targeting is essential for PTG function. Likewise, expression of the PTG mutants that do not bind PP1 substrates did not increase glycogen levels, indicating that PP1 targeting glycogen is not sufficient for the metabolic effects of PTG. These results cumulatively demonstrate that PTG serves as a molecular scaffold, allowing PP1 to recognize its substrates at the glycogen particle.Protein phosphatase-1 (PP1) 1 is one of the four major serine/ threonine protein phosphatase families expressed in eukaryotic cells (2). The enzyme regulates a variety of cellular functions, including cell cycle progression, RNA splicing, vesicle fusion, ion channel function, and muscle contraction (3-8). PP1 also plays a key role in the hormonal regulation of glycogen metabolism, catalyzing the dephosphorylation of glycogen synthase, glycogen phosphorylase, and phosphorylase kinase (9). These dephosphorylation reactions promote the net synthesis of glycogen by activating glycogen synthase and inhibiting phosphorylase. A number of pharmacological (10) and biochemical (11-13) studies have suggested that insulin stimulates glycogen synthesis, at least in part, through the activation of PP1.PP1 is ubiquitously expressed and resides in most cellular compartments. However, the hormonal activation of the enzyme is restricted to discrete sites, such as the glycogen particle, suggesting that mechanisms must exist to ensure the localized regulation of the enzyme. For example, although PP1 is found in a number of cellular locations in fat, liver, and muscle cells, insulin produces the dephosphorylation of only a small fraction of phosphoproteins. The compartmentalization of PP1 is mediated by a family ...