The Cdc25 dual specificity phosphatases coordinate cell cycle progression, but potent and selective inhibitors have generally been unavailable. In the present study, we have examined one potential inhibitor, 6-chloro-7-(2-morpholin-4-ylethylamino)-quinoline-5,8-dione (NSC 663284), that was identified in the compound library of the National Cancer Institute [corrected]. We found that NSC 663284 arrested synchronized cells at both G(1) and G(2)/M phase, and blocked dephosphorylation and activation of Cdk2 and Cdk1 in vivo, as predicted for a Cdc25 inhibitor. Using the natural Cdc25A substrate, Tyr(15)-phosphorylated Cdk2/cyclin A, we demonstrated that NSC 663284 blocked reactivation of Cdk2/cyclin A kinase by Cdc25A catalytic domain in vitro. In-gel trypsin digestion followed by capillary liquid chromatography-electrospray ionization mass spectrometry and tandem mass spectrometry revealed the direct binding of NSC 663284 to one of the two serine residues in the active site loop HCEFSSER of the Cdc25A catalytic domain. Cdc25 binding and inhibition could contribute to the anti-proliferative activity of NSC 663284 and its ability to arrest cell cycle progression. Moreover, NSC 663284 should be a valuable reagent to probe the actions of Cdc25 phosphatases within cells and may also be useful structure for the design of more potent and selective antiproliferative agents.