NFAT transcription factors are highly phosphorylated proteins that are regulated by the calcium-dependent phosphatase calcineurin. We show by mass spectrometry that NFAT1 is phosphorylated on fourteen conserved phosphoserine residues in its regulatory domain, thirteen of which are dephosphorylated upon stimulation. Dephosphorylation of all thirteen residues is required to mask a nuclear export signal (NES), cause full exposure of a nuclear localization signal (NLS), and promote transcriptional activity. An inducible phosphorylation site in the transactivation domain contributes to transcriptional activity. Our data suggest that dephosphorylation promotes NFAT1 activation by increasing the probability of an active conformation, in a manner analogous to that by which depolarization increases the open probability of voltage-gated ion channels. This conformational switch paradigm may explain modification-induced functional changes in other heavily phosphorylated proteins.