A hallmark of signal transduction is the dynamic and inducible post-translational modification of proteins. In addition to the well characterized phosphorylation of proteins, other modifications have been shown to be regulatory, including O-linked beta-N-acetylglucosamine (O-GlcNAc). O-GlcNAc modifies serine and threonine residues on a myriad of nuclear and cytosolic proteins, and for several proteins there appears to be a reciprocal relationship between phosphorylation and O-GlcNAc modification. Here we report further evidence of this yin-yang relationship by demonstrating that O-GlcNAc transferase, the enzyme that adds O-GlcNAc to proteins, exists in stable and active complexes with the serine/threonine phosphatases PP1beta and PP1gamma, enzymes that remove phosphate from proteins. The existence of this complex highlights the importance of understanding the dynamic relationship between O-GlcNAc and phosphate in modulating protein function in many cellular processes and disease states such as Alzheimer's disease and type II diabetes.