Chemical modification of calcineurin by phenylglyoxal was used to probe for the presence of arginine at, or in close proximity to, the catalytic site of this phosphatase. Phenylglyoxal inactivated calcineurin with a second-order rate constant of 1.5 M-1 min-1 at pH 7.5 and 30 degrees C. The inactivation reaction was extremely sensitive to Ca2+-induced conformational changes on calcineurin; removal of this metal ion from the reaction medium increased the rate of inactivation by almost 1 order of magnitude. Furthermore, significant protection of calcineurin by ADP was observed only in the presence of Ca2+, which suggests either that distinct sites are modified by phenylglyoxal in the absence and presence of Ca2+ or that the metal ion promotes binding of ADP to calcineurin. Inactivation of calcineurin by phenyl[2-14C]glyoxal resulted in the incorporation of more than 12 eq of the reagent. However, a kinetic analysis of the order of the inactivation reaction and complete protection of calcineurin by p-nitrophenyl phosphate suggest that only one of the modified residues is responsible for the loss of enzymatic activity. Protection of calcineurin by ADP was enhanced severalfold by calmodulin, which correlated well with a calmodulin-stimulated decrease in the Ki for this ligand. Protection of calcineurin from inactivation by phenylglyoxal was also observed in the presence of various other nucleotides; half-maximal protection by these poor substrates and competitive inhibitors was observed at concentrations near their respective inhibition constants. Thus, the results of this modification study indicate that at least 1 arginine residue is essential for the expression of catalytic activity of the calmodulin-regulated phosphatase.