Protein tyrosine phosphatases (PTPs) are essential signaling enzymes that, together with protein tyrosine kinases, regulate tyrosine phosphorylation inside the cell. Proper level of tyrosine phosphorylation is important for a diverse array of cellular processes, such as proliferation, metabolism, motility, and survival. Aberrant tyrosine phosphorylation, resulting from alteration of PTP expression, misregulation, and mutation, has been linked to the etiology of many human ailments including cancer, diabetes/obesity, autoimmune disorders, and infectious diseases. However, despite the fact that PTPs have been garnering attention as compelling drug targets, they remain a largely underexploited resource for therapeutic intervention. Indeed, PTPs have been widely dismissed as “undruggable”, due to concerns that (1) the highly conserved active site (i.e., pTyr-binding pocket) makes it difficult to achieve inhibitor selectivity among closely related family members, and (2) the positive-charged active site prefers negatively charged molecules, which usually lack cell permeability. To address the issue of selectivity, we advanced a novel paradigm for the acquisition of highly potent and selective PTP inhibitors through generation of bivalent ligands that interact with both PTP active site and adjacent unique peripheral pockets. To overcome the bioavailability issue, we have identified nonhydrolyzable pTyr mimetics that are sufficiently polar to bind the PTP active site, yet still capable of efficiently penetrating cell membranes. We show that these pTyr mimetics interact in the desired inhibitory fashion with the PTP active site and tethering them to appropriate molecular fragments to engage less conserved interactions outside of PTP active site can increase PTP inhibitor potency and selectivity. We demonstrate through three pTyr mimetics fragment-based approaches that it is completely feasible to obtain highly potent and selective PTP inhibitors with robust in vivo efficacy in animal models of oncology, diabetes/obesity, autoimmune disorders, and tuberculosis. We hope that these results will help dispel concerns about the druggability of PTPs and entice further effort in fostering a PTP-based drug discovery enterprise. Well-characterized, potent, selective and bioactive inhibitors are essential tools for functional interrogation of PTPs in disease biology and target validation. They will also play a critical role in illuminating the druggability of PTPs and provide the groundwork for new therapies for the treatment of human diseases.