Regulation of Cl(-) channel conductance by Ins(3,4,5,6)P(4) provides receptor-dependent control over salt and fluid secretion, cell volume homeostasis, and electrical excitability of neurones and smooth muscle. Ignorance of how Ins(3,4,5,6)P(4) is synthesized has long hindered our understanding of this signaling pathway. We now show Ins(3,4,5,6)P(4) synthesis by Ins(1,3,4,5,6)P(5) 1-phosphatase activity by an enzyme previously characterized as an Ins(3,4,5,6)P(4) 1-kinase. Rationalization of these phenomena with a ligand binding model unveils Ins(1,3,4)P(3) as not simply an alternative kinase substrate, but also an activator of Ins(1,3,4,5,6)P(5) 1-phosphatase. Stable overexpression of the enzyme in epithelial monolayers verifies its physiological role in elevating Ins(3,4,5,6)P(4) levels and inhibiting secretion. It is exceptional for a single enzyme to catalyze two opposing signaling reactions (1-kinase/1-phosphatase) under physiological conditions. Reciprocal coordination of these opposing reactions offers an alternative to general doctrine that intracellular signals are regulated by integrating multiple, distinct phosphatases and kinases.