The p53 tumor suppressor is inhibited and destabilized by Mdm2. However, under stress conditions, this downregulation is relieved, allowing the accumulation of biologically active p53. Recently we showed that c-Abl is important for p53 activation under stress conditions. In response to DNA damage, c-Abl protects p53 by neutralizing the inhibitory effects of Mdm2. In this study we ask whether this neutralization involves a direct interplay between c-Abl and Mdm2, and what is the contribution of the c-Abl kinase activity? We demonstrate that the kinase activity of c-Abl is required for maintaining the basal levels of p53 expression and for achieving maximal accumulation of p53 in response to DNA damage. Importantly, c-Abl binds and phosphorylates Mdm2 in vivo and in vitro. We characterize Hdm2 (human Mdm2) phosphorylation at Tyr394. Substitution of Tyr394 by Phe394 enhances the ability of Mdm2 to promote p53 degradation and to inhibit its transcriptional and apoptotic activities. Our results suggest that phosphorylation of Mdm2 by c-Abl impairs the inhibition of p53 by Mdm2, hence defining a novel mechanism by which c-Abl activates p53.