Slingshot-1 (SSH1), a member of a dual-specificity protein phosphatase family, regulates actin dynamics by dephosphorylating and reactivating cofilin, an actin-depolymerizing factor. SSH1 has the SSH family-specific, N-terminal, noncatalytic (SSH-N) domain, consisting of the A and B subdomains. SSH1 is activated by binding to actin filaments. In this study, we examined the mechanisms of SSH1 substrate recognition of phosphocofilin (P-cofilin) and SSH1 activation by F-actin. We found that P-cofilin binds to a phosphatase-inactive mutant, SSH1(CS), in which the catalytic Cys-393 is replaced by Ser. Using a series of deletion mutants, we provided evidence that both the phosphatase (P) domain and the adjacent B domain are indispensable for P-cofilin binding of SSH1(CS) and cofilin-phosphatase activity of SSH1. In contrast, the A domain is required for the F-actinmediated activation of SSH1, but not for P-cofilin binding or basal cofilin-phosphatase activity. The P domain alone is sufficient for the phosphatase activity toward p-nitrophenyl phosphate (pNPP), indicating that the SSH-N domain is not essential for the basal phosphatase activity of SSH1. Addition of F-actin increased the cofilin-phosphatase activity of SSH1 more than 1200-fold, but the pNPP-phosphatase activity only 2.2-fold, which suggests that F-actin principally affects the cofilin-specific phosphatase activity of SSH1. When expressed in cultured cells, SSH1, but not its mutant deleted of SSH-N, accumulated in the rear of the lamellipodium. Together, these findings suggest that the conserved SSH-N domain plays critical roles in P-cofilin recognition, F-actin-mediated activation, and subcellular localization of SSH1.Protein phosphorylation is one of the most ubiquitous types of post-translational protein modification and is essential for signaling pathways mediating diverse cellular processes. Protein phosphorylation is regulated by the balanced actions of protein kinases and protein phosphatases. Protein-tyrosine phosphatases (PTPs) 2 constitute the largest family of phosphatases. These enzymes are defined by their active-site signature motif, (H/V)CX 5 R(S/T), in which the nucleophilic Cys residue attacks the phosphate group of target proteins (1-3). Of ϳ100 phosphatase genes classified into the PTP family in the human genome, the most diverse group, in terms of the substrate specificity, is the group of dual-specificity phosphatases (DSPs) (4). DSPs are further divided into several subgroups, each having a wide range of substrate specificities for phospho-Ser, phosphoThr, phosphoinositide, and mRNA, in addition to phospho-Tyr (3, 4). These phosphatases play specific roles in decreasing the phosphorylation levels of target molecules and controlling signal transduction pathways that underlie a variety of physiological processes.Cofilin is a key regulator of actin filament dynamics and functions by stimulating the depolymerization and severance of actin filaments (5). Cofilin activity is regulated by its specific kinases and phosphatases. Cofilin is in...