Iodination is a very useful method for protein characterization and labeling. However, derivatization chemistries used in most conventional iodination procedures may cause substantial alterations in protein structure and function. The IPy(2)BF(4) reagent [bis(pyridine)iodonium (I) tetrafluoroborate] has been shown to be an effective iodinating reagent for peptides. Herein we report the first application of IPy(2)BF(4) in protein iodination in an aqueous medium using three representative substrates: insulin, lysozyme, and the enzyme 1,3-1,4-beta-d-4-glucanohydrolase. Our results show that IPy(2)BF(4) has clear advantages over existing methods in that the reaction is quantitative, fast, and selective for the most accessible Tyr residues of a protein, and it preserves the functional integrity of the protein when moderate Tyr labeling levels are pursued.