We have recently reported that human soluble epoxide hydrolase (sEH) is a bifunctional enzyme with a novel phosphatase enzymatic activity. Based on a structural relationship with other members of the haloacid dehalogenase superfamily, the sEH N-terminal phosphatase domain revealed four conserved sequence motifs, including the proposed catalytic nucleophile D9, and several other residues potentially implicated in substrate turnover and/or Mg(2+) binding. To enlighten the catalytic mechanism of dephosphorylation, we constructed sEH phosphatase active-site mutants by site-directed mutagenesis. A total of 18 mutants were constructed and recombinantly expressed in Escherichia coli as soluble proteins, purified to homogeneity and subsequently analysed for their kinetic parameters. A replacement of residues D9, K160, D184 or N189 resulted in a complete loss of phosphatase activity, consistent with an essential function for catalysis. In contrast, a substitution of D11, T123, N124 and D185 leads to sEH mutant proteins with altered kinetic properties. We further provide evidence of the formation of an acylphosphate intermediate on D9 by liquid chromatography-tandem mass spectrometry based on the detection of homoserine after NaBH(4) reduction of the phosphorylated enzyme, which identifies D9 as the catalytic nucleophile. Surprisingly, we could only show such homoserine formation using the D11N mutant, which strongly suggests D11 to be involved in the acylphosphate hydrolysis. In the D11 mutant, the second catalytic step becomes rate limiting, which then allows trapping of the labile intermediate. Substrate turnover in the presence of (18)H(2)O revealed that the nucleophilic attack during the second reaction step occurs at the acylphosphate phosphorous. Based on these findings, we propose a two-step catalytic mechanism of dephosphorylation that involves the phosphate substrate hydrolysis by nucleophilic attack by the catalytic nucleophile D9 followed by hydrolysis of the acylphosphate enzyme intermediate supported by D11.