Calcineurin is composed of a catalytic subunit A (CNA) and a regulatory subunit B (CNB). In addition to the catalytic core, CNA further contains three non-catalytic domains--CNB binding domain (BBH), calmodulin binding domain (CBD), and autoinhibitory domain (AI). To investigate the effect of these three domains on the activity of CNA, we have constructed domain deletion mutants CNAa (catalytic domain only), CNAac (CNAa and CBD), and CNAaci (CNAa, CBD and AI). By using p-nitrophenylphosphate and (32)P-labeled R(II) peptide as substrates, we have systematically examined the phosphatase activities, kinetics, and regulatory effects of Mn(2+)/Ni(2+) and Mg(2+). The results show that the catalytic core has the highest activity and the order of activity of the remaining constructs is CNAac>CNAaci>CNA. Sequential removal of the non-catalytic domains corresponds to concurrent increases of the phosphatase activity assayed under several conditions. This observation clearly demonstrates that non-catalytic domains negatively regulate the enzyme activity and act as intra-molecular inhibitors, possibly through restraining the conformation elasticity of the catalytic core required for optimal catalysis or interfering with substrate access. The sequential domain deletion favors activation of the enzyme by Mn(2+)/Ni(2+) but not by Mg(2+) (except for CNAa), suggesting that enzyme activation by Mn(2+)/Ni(2+) is mainly mediated via the catalytic domain, whereas activation by Mg(2+) is via both the catalytic core and non-catalytic domains.