The cyclin-dependent kinases are key cell cycle regulators whose activation is required for passage from one cell cycle phase to the next. In mammalian cells, CDK2 has been implicated in control of the G1 and S phases. We have used a two-hybrid protein interaction screen to identify cDNAs encoding proteins that can interact with CDK2. Among those identified was a protein (KAP), which contained the HCXX-XXGR motif characteristic of protein tyrosine phosphatases. KAP showed phosphatase activity toward substrates containing either phosphotyrosine or phosphoserine residues. Since KAP is not significantly similar to known phosphatases beyond the catalytic core motif, it represents an additional class of dual specificity phosphatase. KAP interacted with cdc2 and CDK2 in yeast. In mammalian cells, KAP also associated with cdc2 and CDK2 but showed a preference for cdc2. The ability of KAP to bind multiple cyclin-dependent kinases suggests that it may play a role in cell cycle regulation.