The suppressors of cytokine signaling (SOCS) are negative feedback inhibitors of cytokine and growth factor-induced signal transduction. The C-terminal SOCS box region is thought to regulate SOCS protein stability most likely via an elongin C interaction. In the present study, we have found that phosphorylation of SOCS3 at two tyrosine residues in the conserved SOCS box, Tyr204 and Tyr221, can inhibit the SOCS3-elongin C interaction and activate proteasome-mediated SOCS3 degradation. Jak-mediated phosphorylation of SOCS3 decreased SOCS3 protein half-life, and phosphorylation of both Tyr204 and Tyr221 was required to fully destabilize SOCS3. In contrast, a phosphorylation-deficient mutant of SOCS3, Y204F,Y221F, remained stable in the presence of activated Jak2 and receptor tyrosine kinases. SOCS3 stability correlated with the relative amount that bound elongin C, because in vitro phosphorylation of a SOCS3-glutathione S-transferase fusion protein abolished its ability to interact with elongin C. In addition, a SOCS3/SOCS1 chimera that co-precipitates with markedly increased elongin C, was significantly more stable than wild-type SOCS3. The data suggest that interaction with elongin C stabilizes SOCS3 protein expression and that phosphorylation of SOCS box tyrosine residues disrupts the complex and enhances proteasome-mediated degradation of SOCS3.