We describe a phage display approach that we have previously used to generate conformation-sensor antibodies that specifically recognize and stabilize the oxidized, inactive conformation of protein tyrosine phosphatase 1B (PTP1B). We use a solution-based panning and screening strategy conducted in the presence of reduced active PTP1B, which enriches antibodies to epitopes unique to the oxidized form while excluding antibodies that recognize epitopes common to oxidized and reduced forms of PTP1B. This strategy avoids conventional solid-phase immobilization owing to its inherent potential for denaturation of the antigen. In addition, a functional screening strategy selects single-chain variable fragments (scFvs) directly for their capacity for both specific binding and stabilization of the target enzyme in its inactive conformation. These conformation-specific scFvs illustrate that stabilization of oxidized PTP1B is an effective strategy to inhibit PTP1B function; it is possible that this approach may be applicable to the protein tyrosine phosphatase (PTP) family as a whole. With this protocol, isolation and characterization of specific scFvs from immune responsive animals should take ~6 weeks.