pp56lck, encoded by the lck proto-oncogene, is a non-receptor tyrosine protein kinase (TPK) found in all T lymphocytes. A significant fraction of pp56lck is tightly associated with the cytoplasmic domains of CD4 and CD8 glycoproteins, suggesting an important role for it in thymic development and T cell activation. We have studied the regulation of the tyrosine kinase activity of pp56lck and found recently that it becomes rapidly activated in isolated T cell membranes by an endogenous mechanism apparently involving a phosphotyrosine phosphatase (PTPase). Moreover pp56lck was activated upon addition of isolated CD45 (leukocyte common antigen), a major membrane PTPase, and activation was absent in T cell mutants lacking CD45. Here, we address in more detail the mechanisms of pp56lck activation by the CD45 PTPase and show that this event is time-dependent, sensitive to Na3VO4 (which blocks the PTPase activity of CD45), and is accompanied by dephosphorylation of a regulatory tyrosine residue (Tyr-505) near the C-terminus of pp56lck. This provides a molecular mechanism for regulation of the catalytic activity of pp56lck by CD45, which thus is likely to be the physiological activator of pp56lck. Activation of pp56lck by the CD45 PTPase may underlie many of the reported immunomodulatory effects of antibodies to CD45, and provides further support for the notion that CD45-mediated tyrosine dephosphorylation plays a critical role in T cell activation and growth.