The protein tyrosine phosphatases are a family of enzymes that play critical roles in regulating physiological processes including cellular signaling, growth, differentiation, and the immune response. As new roles emerge for these enzymes in human disease, interest in understanding their mechanism of regulation and function has increased correspondingly. The recent development of mechanism-based probes for phosphatase activity has paved the way for detailed studies of tyrosine phosphatase activity and regulation in both physiological and pathological cellular signaling.