The p53 tumor suppressor protein is a transcription factor with sequence-specific DNA binding activity that is thought to be important for the growth-inhibitory function of p53. DNA binding appears to require activation of a cryptic form of p53 by allosteric mechanisms involving a negative regulatory domain at the carboxyl terminus of p53. The latent form of p53, reactive to the carboxyl-terminal antibody PAb421, is produced in a variety of eukaryotic cells, suggesting that activation of p53 is an important rate-limiting step in vivo. In this report we provide evidence that phosphorylation of serine 378 within the carboxyl-terminal negative regulatory domain of the human p53 protein by protein kinase C correlates with loss of PAb421 reactivity and a concomitant activation of sequence-specific DNA binding. These effects are reversed by subsequent dephosphorylation of the protein kinase C-reactive site by protein phosphatases 1 (PP1) and 2A (PP2A), which restore the reactivity of p53 to PAb421 and regenerate the latent form of p53 lacking significant DNA binding activity. Thus, p53 is subject to both positive and negative regulation by reversible enzymatic modifications affecting the latent or active state of the protein, suggesting a possible mechanism for the regulation of its tumor suppressor function.