scientific report (PTP1B) is a protein-tyrosine phosphatase predominantly localized on intracellular membranes by means of a hydrophobic carboxy-terminal targeting sequence (Frangioni et al., 1992). Evidence for the involvement of PTP1B in insulin action has been provided by studies showing that increased insulin sensitivity is associated with higher levels of tyrosine phosphorylation of the IR and one of its substrates, IR substrate 1 (IRS1), in the liver and skeletal muscle of insulintreated Ptp1B knockout mice (Elchebly et al., 1999). Because PTP1B could be a potential therapeutic target, a better understanding of the interaction between the IR and PTP1B is an important requirement for the development of compounds to improve insulin sensitivity. However, although PTP1B has been shown to interact physically with the IR (Bandyopadhyay et al., 1997), nothing is known about the dynamics of this interaction in living cells.Bioluminescence resonance energy transfer (BRET) allows the study of protein-protein interactions in intact living cells (Angers et al., 2000;Xu et al., 1999). To study the interaction between two proteins, one of them is fused to Renilla luciferase (Rluc) and the other to a yellow fluorescent protein (YFP). The luciferase is excited by a substrate (coelenterazine). If the two proteins are less than 100 Å apart, energy transfer occurs between the luciferase and the YFP, and a signal emitted by the YFP can be detected. We previously showed that this methodology can be used to monitor insulin-induced conformational The dynamics of the interaction of the insulin receptor with a substrate-trapping mutant of protein-tyrosine phosphatase 1B (PTP1B) were monitored in living human embryonic kidney cells using bioluminescence resonance energy transfer (BRET). Insulin dosedependently stimulates this interaction, which could be followed in real time for more than 30 minutes. The effect of insulin on the BRET signal could be detected at early time-points (30 seconds), suggesting that in intact cells the tyrosine-kinase activity of the insulin receptor is tightly controlled by PTP1B. Interestingly, the basal (insulin-independent) interaction of the insulin receptor with PTP1B was much weaker with a soluble form of the tyrosinephosphatase than with the endoplasmic reticulum (ER)-targeted form. Inhibition of insulin-receptor processing using tunicamycin suggests that the basal interaction occurs during insulin-receptor biosynthesis in the ER. Therefore, localization of PTP1B in this compartment might be important for the regulation of insulin receptors during their biosynthesis.