The Ipl1 protein kinase is essential for proper chromosome segregation and cell viability in the budding yeast Saccharomyces cerevisiae. We have previously shown that the temperature-sensitive growth phenotype of conditional ipl1-1 ts mutants can be suppressed by a partial loss-of-function mutation in the GLC7 gene, which encodes the catalytic subunit (PP1 C ) of protein phosphatase 1, thus suggesting that this enzyme acts in opposition to the Ipl1 protein kinase in regulating yeast chromosome segregation. We report here that the Glc8 protein, which is related in primary sequence to mammalian inhibitor 2, also participates in this regulation. Like inhibitor 2, the Glc8 protein is heat stable, exhibits anomalous electrophoretic mobility, and functions in vitro as an inhibitor of yeast as well as rabbit skeletal muscle PP1 C . Interestingly, overexpression as well as deletion of the GLC8 gene results in a partial suppression of the temperature-sensitive growth phenotype of ipl1 ts mutants and also moderately reduces the amount of protein phosphatase 1 activity which is assayable in crude yeast lysates. In addition, the chromosome missegregation phenotype caused by an increase in the dosage of GLC7 is totally suppressed by the glc8-⌬101::LEU2 deletion mutation. These findings together suggest that the Glc8 protein is involved in vivo in the activation of PP1 C and that when the Glc8 protein is overproduced, it may also inhibit PP1 C function. Furthermore, site-directed mutagenesis studies of GLC8 suggest that Thr-118 of the Glc8 protein, which is equivalent to Thr-72 of inhibitor 2, may play a central role in the ability of this protein to activate and/or inhibit PP1 C in vivo.The reversible phosphorylation of proteins is a major mechanism for the control of protein functions in eukaryotes. Phosphorylation and dephosphorylation of proteins on serine, threonine, and tyrosine residues has been shown to be involved in the control of many essential cellular processes, including chromosome segregation, metabolism, transcription, translation, and cell division. The phosphorylation state of a given protein is determined by a dynamic equilibrium between the activities of the protein kinase(s) and protein phosphatase(s) that recognize it as a substrate. Protein phosphatases that are specific for phosphoserine and phosphothreonine can be divided biochemically into at least four major classes: protein phosphatases 1, 2A, 2B, and 2C (PP1, PP2A, PP2B, and PP2C, respectively). These four classes of enzymes differ in their substrate specificity, cation requirements, and sensitivity to certain inhibitors (reviewed in references 20 and 54). Protein phosphatase activities characteristic of all four classes are found in diverse organisms, ranging from Saccharomyces cerevisiae to mammals (22,45,59).PP1 proteins purified from different sources all contain a catalytic subunit (PP1 C ) of ϳ37 kDa which is often associated with other proteins. These associated proteins include the glycogen-and sarcoplasmic reticulum-binding G subunit from...