The role of phosphorylation on the gene activation activity of the human beta 1 thyroid hormone nuclear receptor (h-TR beta 1) was examined. h-TR beta 1 was found to be a phosphoprotein when expressed in COS-1 cells, with serine, threonine, and tyrosine (85:10:5) as the phosphorylation sites. Okadaic acid (a potent inhibitor of phosphatases 1 and 2A) at 0.1, 0.25, and 0.5 microM increased the phosphorylation of h-TR beta 1 by 3-, 7-, and 11-fold, respectively. The increase in phosphorylation was accompanied by a concomitant increase in phosphorylation was accompanied by a concomitant increase in receptor-mediated transcription in transient transfection assays. h-TR beta 1 purified from Escherichia coli was phosphorylated in vitro by the endogenous kinase from cellular extracts. Serine, threonine, and tyrosine were phosphorylated in a similar ratio to that found in COS-1 cells. The in vitro phosphorylation was stimulated by okadaic acid. Phosphorylation did not affect the binding of h-TR beta 1 to 3,3',5-triiodo-L-thyronine. However, phosphorylation of h-TR beta 1 resulted in an increase of its binding to DNA and conferred on it the ability to bind to nuclear accessory proteins. The results indicate that phosphorylation plays an important role in the transcriptional activity of h-TR beta 1.