Treatment of chicken embryo fibroblasts (CEFs) with trypsin results in a dose- and time-dependent loss of phosphotyrosine from cellular proteins. A similar, but less marked, reduction in protein tyrosine phosphorylation occurs upon incubation of CEFs in phosphate-buffered saline (PBS). The decrease in the phosphotyrosine content of proteins following treatment with trypsin or PBS, as determined by immunoblotting of cell extracts with anti-phosphotyrosine antibodies, corresponds with a loss of phosphotyrosine antibody immunoreactivity at focal contacts, as detected by immunofluorescence microscopy. The recovery of phosphotyrosine in cellular proteins occurs within 30 min following removal of trypsin, even in the presence of the protein synthesis inhibitor cycloheximide, indicating that the loss of phosphotyrosine-containing proteins is not due to their degradation by trypsin. Pretreatment of CEFs with inhibitors of protein-tyrosine-phosphatases greatly reduces the loss of phosphotyrosine from proteins brought about by trypsin. In addition, phosphotyrosine phosphatase activity is increased in extracts prepared from trypsin-treated CEFs. The loss of phosphotyrosine from proteins following treatment with trypsin or PBS is not specific to CEFs but is also observed in established fibroblast lines. Taken together these results suggest that the activity of one or more phosphotyrosine phosphatases is regulated by cell-substrate adhesion.