A phosphoprotein phosphatase that catalyzes the dephosphorylation of cyclic adenosine 3':5'-monophosphate (cAMP)-dependent protein kinase from bovine cardiac muscle has been purified to homogeneity by a modification of the procedure of Brandt et al. (Brandt, H., Capulong, Z.L., and Lee, E. Y. C. (1975) J. Biol. Chem. 250, 8038-8044). Treatment of the enzyme preparation with ethanol during the early stages of purification results in activation concomitant with reduction in molecular weight to 30,000. The purified activated enzyme has a Km for phospho-protein kinase in the presence or absence of 1.2 mM Mn2+ of 5 and 22 micronM, respectively. Phosphatase activity on phospho-protein kinase but not on other phosphoprotein substrates was cAMP-dependent. This selective activation by cAMP reflects the preference of the phosphatase for the free, phosphorylated cAMP-binding protein rather than the phosphoholoenzyme.