Atrial natriuretic peptide (ANP) binds to the guanylyl cyclase-A (GC-A) receptor found in tissues such as the kidney and adrenal gland, resulting in marked elevations of the intracellular signaling molecule, cGMP. Here, GC-A is shown to exist as a phosphoprotein when expressed in human embryonic 293 cells. The 32P is principally associated with phosphoserine, with only trace amounts of phosphothreonine. The addition of ANP causes a time-dependent dephosphorylation of the receptor, as well as desensitization, which is not due to an ANP-mediated decrease in the amount of receptor protein. The mobility of GC-A on sodium dodecyl sulfate-polyacrylamide gel electrophoresis increases after treatment of cells with ANP, and protein phosphatase 2A induces the same mobility shift. The protein phosphatase also catalyzes dephosphorylation of GC-A, and this is directly correlated with decreases in ANP-stimulatable guanylyl cyclase activity. Okadaic acid, an inhibitor of protein phosphatase 2A, blocks both the dephosphorylation and the desensitization. Therefore, in contrast to many other cell surface receptors, GC-A is desensitized by ligand-induced dephosphorylation.