Functional expression of recombinant wild-type phosphatase 2A catalytic subunit has been unsuccessful in the past. A nine-amino-acid peptide sequence (YP-YDVPDYA) derived from the influenza hemagglutinin protein was used to modify the NH2 and/or COOH terminus of the phosphatase 2A catalytic subunit. Addition of the nine-amino-acid sequence at the NH2 terminus allowed recombinant phosphatase 2A expression as a predominantly cytosolic phosphatase 2A enzyme. The 12CA5 monoclonal antibody that recognizes the nine-amino-acid hemagglutinin peptide sequence was used to immunoprecipitate the epitope-tagged phosphatase 2A catalytic subunit. Assay of the immunoprecipitated epitope-tagged phosphatase 2A demonstrated an okadaic acid-sensitive dephosphorylation of [32P] histone H1 and [32P]myelin basic protein similar to that measured with the wild-type enzyme. Functional phosphatase activity could be demonstrated for the NH2-terminal modified phosphatase 2A catalytic subunit following transient expression in COS cells or stable expression in Rat1a cells. In contrast, the COOH-terminal-modified phosphatase 2A catalytic subunit was very poorly expressed. The NH2-, COOH-modified subunit, having the nine-amino-acid hemagglutinin peptide sequence encoded at both termini of the polypeptide, was also expressed as a functional phosphatase 2A enzyme. Thus, NH2-terminal modification of the phosphatase 2A catalytic subunit results in a functional plasmid-expressed enzyme. The unique nine-amino-acid epitope-tag sequence also provides a method to easily resolve the recombinant phosphatase 2A from the endogenous wild-type gene product and related phosphatases expressed in cells.