Phosphatidylinositides play important roles in cellular signaling and migration. Phosphatidylinositol-3,4,5-trisphosphate (PI(3,4,5)P3) is an important phosphatidylinositide because it acts as a secondary messenger to trigger cell movement and proliferation. A high level of PI(3,4,5)P3 at the plasma membrane is known to contribute to tumorigenesis. One key enzyme that regulates PI(3,4,5)P3 levels at the plasma membrane is phosphatase and tensin homologue deleted on chromosome 10 (PTEN), which dephosphorylates PI(3,4,5)P3 through hydrolysis to form phosphatidylinositol-4,5-bisphosphate (PI(4,5)P2). It has been reported that PI(4,5)P2 is involved in positive feedback in the PI(3,4,5)P3 hydrolysis by PTEN. However, how PI(3,4,5)P3 dephosphorylation by PTEN is regulated, is still under debate. How other PI(3,4,5)P3-binding proteins affect the dephosphorylation kinetics catalyzed by PTEN also remains unclear. Here, we develop a fluorescent-protein biosensor approach to study how PI(3,4,5)P3 dephosphorylation is regulated by PTEN as well as its membrane-mediated feedback mechanisms. Our observation of sigmoidal kinetics of the PI(3,4,5)P3 hydrolysis reaction supports the notion of autocatalysis in PTEN function. We developed a kinetic model to describe the observed reaction kinetics, which allowed us to i) distinguish between membrane-recruitment and allosteric activation of PTEN by PI(4,5)P2, ii) account for the influence of the biosensor on the observed reaction kinetics, and iii) demonstrate that all of these mechanisms contribute to the kinetics of PTEN-mediated catalysis.