The p53 tumor suppressor protein plays a critical role in mediating cellular response to stress. Upon DNA damage, post-translational modifications stabilize and activate this nuclear phosphoprotein. To determine the effect of phosphorylation site mutants in the context of the whole p53 protein, we performed reporter assays in p53 and MDM2 knockout mouse embryonic fibroblasts transfected with full-length p53 constructs. We show that mutation of S37 causes a decrease in p53 transcriptional activity compared to wild-type p53. Our data further suggest that the dephosphorylation of p53 at S37 is a regulated event involving protein phosphatase 2A (PP2A). Coimmunoprecipitation and immunofluorescence microscopy studies demonstrate that PP2A and p53 associate with one another in vivo following γ-irradiation. Consistent with these observations, phosphorylated S37 accumulates in cell extracts prepared from γ-irradiated Molt-4 cells in the presence of okadaic acid. Furthermore, in vitro phosphatase assays show that PP2A dephosphorylates p53 at S37. These results suggest that dephosphorylation of p53 at S37 plays a role in the transcriptional regulation of the p53 protein in response to DNA damage.