The protein tyrosine phosphatase PEST (PTP-PEST) is involved in the regulation of the actin cytoskeleton. Despite the emerging functions attributed to both PTPs and the actin cytoskeleton in apoptosis, the involvement of PTP-PEST in apoptotic cell death remains to be established. Using several cell-based assays, we showed that PTP-PEST participates in the regulation of apoptosis. As apoptosis progressed, a pool of PTP-PEST localized to the edge of retracting lamellipodia. Expression of PTP-PEST also sensitized cells to receptor-mediated apoptosis. Concertedly, specific degradation of PTP-PEST was observed during apoptosis. Pharmacological inhibitors, immunodepletion experiments, and in vitro cleavage assays identified caspase-3 as the primary regulator of PTP-PEST processing during apoptosis. Caspase-3 specifically cleaved PTP-PEST at the 549 DSPD motif and generated fragments, some of which displayed increased catalytic activity. Moreover, caspase-3 regulated PTP-PEST interactions with paxillin, leupaxin, Shc, and PSTPIP. PTP-PEST acted as a scaffolding molecule connecting PSTPIP to additional partners: paxillin, Shc, Csk, and activation of caspase-3 correlated with the modulation of the PTP-PEST adaptor function. In addition, cleavage of PTP-PEST facilitated cellular detachment during apoptosis. Together, our data demonstrate that PTP-PEST actively contributes to the cellular apoptotic response and reveal the importance of caspases as regulators of PTPs in apoptosis.