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Bacteriophage lambda protein phosphatase (lambdaPP) with Mn(2+) as the activating metal cofactor was studied using phosphatase inhibition kinetics and electron paramagnetic resonance (EPR) spectroscopy. Orthophosphate and the oxoanion analogues orthovanadate, tungstate, molybdate, arsenate, and sulfate were shown to inhibit the phosphomonoesterase activity of lambdaPP, albeit with inhibition constants (K(i)) that range over 5 orders of magnitude. In addition, small organic anions were tested as inhibitors. Phosphonoacetohydroxamic acid (PhAH) was found to be a strong competitive inhibitor (K(i) = 5.1 +/- 1.6 microM) whereas phosphonoacetic acid (K(i) = 380 +/- 45 microM) and acetohydroxamic acid (K(i) > 75 mM) modestly inhibited lambdaPP. Low-temperature EPR spectra of Mn(2+)-reconstituted lambdaPP in the presence of oxoanions and PhAH demonstrate that inhibitor binding decreases the spin-coupling constant, J, compared to the native enzyme. This suggests a change in the bridging interaction between Mn(2+) ions of the dimer due to protonation or replacement of a bridging ligand. Inhibitor binding also induces several spectral shifts. Hyperfine splitting characteristic of a spin-coupled (Mn(2+))(2) dimer is most prominent upon the addition of orthovanadate (K(i) = 0.70 +/- 0.20 microM) and PhAH, indicating that these inhibitors tightly interact with the (Mn(2+))(2) form of lambdaPP. These EPR and inhibition kinetic results are discussed in the context of establishing a common mechanism for the hydrolysis of phosphate esters by lambdaPP and other serine/threonine protein phosphatases.