Prolidase [EC 3.4.13.9] is a ubiquitously distributed imidodipeptidase that catalyzes the hydrolysis of C-terminal proline-containing dipeptides. The enzyme plays an important role in the recycling of proline for collagen synthesis and cell growth. Although, the increase in the enzyme activity is correlated with increased rate of collagen turnover, the mechanism by which prolidase is regulated remain largely unknown. In the present study we found that phosphorylation of fibroblast's prolidase may be an underlying mechanism for up regulation of the enzyme activity. Supporting evidence comes from the following observations: (1) immunoprecipitated prolidase was detected as a phosphotyrosine protein as shown by western immunoblot analysis, (2) tyrosine kinase inhibitor-erbstatin induced (in a dose dependent manner) a decrease in prolidase activity in cultured human skin fibroblasts, (3) anti-phosphotyrosine antibody reduced and phosphotyrosine phosphatase 1B antibody (anti-PTP 1B) increased (in a dose dependent manner) the prolidase activity in extract of fibroblast's homogenate, (4) decrease in prolidase activity from collagenase treated or serum starved fibroblasts can be partially prevented by incubating fibroblast's homogenate extract with anti-PTP 1B antibody. These results provide evidence that prolidase is phosphotyrosine enzyme and suggest that the activity of prolidase may be up regulated by the enzyme phosphorylation.