The structure of the SHP-2 tyrosine phosphatase, determined at 2.0 angstroms resolution, shows how its catalytic activity is regulated by its two SH2 domains. In the absence of a tyrosine-phosphorylated binding partner, the N-terminal SH2 domain binds the phosphatase domain and directly blocks its active site. This interaction alters the structure of the N-SH2 domain, disrupting its phosphopeptide-binding cleft. Conversely, interaction of the N-SH2 domain with phosphopeptide disrupts its phosphatase recognition surface. Thus, the N-SH2 domain is a conformational switch; it either binds and inhibits the phosphatase, or it binds phosphoproteins and activates the enzyme. Recognition of bisphosphorylated ligands by the tandem SH2 domains is an integral element of this switch; the C-terminal SH2 domain contributes binding energy and specificity, but it does not have a direct role in activation.

Src homology 2 (SH2) domains are phosphotyrosine binding modules found within many cytoplasmic proteins. A major function of SH2 domains is to bring about the physical assembly of signaling complexes. We now show that, in addition, simultaneous occupancy of both SH2 domains of the phosphotyrosine phosphatase SH-PTP2 (Syp, PTP 1D, PTP-2C) by a tethered peptide with two IRS-1-derived phosphorylation sites potently stimulates phosphatase activity. The concentration required for activation by the tethered peptide is 80-160-fold lower than either corresponding monophosphorylated peptide. Moreover, the diphosphorylated peptide stimulates catalytic activity 37-fold, compared with 9-16-fold for the monophosphorylated peptides. Mutational analyses of the SH2 domains of SH-PTP2 confirm that both SH2 domains participate in this effect. Binding studies with a tandem construct comprising the N- plus C-terminal SH2 domains show that the diphosphorylated peptide binds with 60-90-fold higher affinity than either monophosphorylated sequence. These results demonstrate that SH-PTP2 activity can be potently regulated by interacting via both of its SH2 domains with phosphoproteins having two cognate phosphorylation sites.

The domain organization of many signalling proteins facilitates a segregation of binding, catalytic and regulatory functions. The mammalian SH2 domain protein tyrosine phosphatases (PTPs) contain tandem SH2 domains and a single carboxy-terminal catalytic domain. SH-PTP1 (PTP1C, HCP) and SH-PTP2 (Syp, PTP2C, PTP1D) function downstream from tyrosine kinase-linked insulin, growth factor, cytokine and antigen receptors. As well as directing subcellular localization by binding to receptors and their substrates, the two SH2 domains of these PTPs function together to regulate catalysis. Here we report the structure of the tandem SH2 domains of SH-PTP2 in complex with monophosphopeptides. A fixed relative orientation of the two domains, stabilized by a disulphide bond and a small hydrophobic patch within the interface, separates the peptide binding sites by approximately 40 A. The defined orientation of the SH2 domains in the structure, and data showing that peptide orientation and spacing between binding sites is critical for enzymatic activation, suggest that spatial constraints are important in this multidomain protein-protein interaction.