Occludin is phosphorylated on tyrosine residues during the oxidative stress-induced disruption of tight junction, and in vitro phosphorylation of occludin by c-Src attenuates its binding to ZO-1. In the present study mass spectrometric analyses of C-terminal domain of occludin identified Tyr-379 and Tyr-383 in chicken occludin as the phosphorylation sites, which are located in a highly conserved sequence of occludin, YETDYTT; Tyr-398 and Tyr-402 are the corresponding residues in human occludin. Deletion of YETDYTT motif abolished the c-Src-mediated phosphorylation of occludin and the regulation of ZO-1 binding. Y398A and Y402A mutations in human occludin also abolished the c-Src-mediated phosphorylation and regulation of ZO-1 binding. Y398D/Y402D mutation resulted in a dramatic reduction in ZO-1 binding even in the absence of c-Src. Similar to wild type occludin, its Y398A/Y402A mutant was localized at the plasma membrane and cell-cell contact sites in Rat-1 cells. However, Y398D/Y402D mutants of occludin failed to localize at the cell-cell contacts. Calcium-induced reassembly of Y398D/Y402D mutant occludin in Madin-Darby canine kidney cells was significantly delayed compared with that of wild type occludin or its T398A/T402A mutant. Furthermore, expression of Y398D/Y402D mutant of occludin sensitized MDCK cells for hydrogen peroxide-induced barrier disruption. This study reveals a unique motif in the occludin sequence that is involved in the regulation of ZO-1 binding by reversible phosphorylation of specific Tyr residues.