Tyrosine hydroxylase (TH), the rate-limiting enzyme in catecholamine synthesis, is stimulated by N-terminal phosphorylation by several kinases and inhibited by protein serine/threonine phosphatase 2A (PP2A). PP2A is a family of heterotrimeric holoenzymes containing one of more than a dozen different regulatory subunits. In comparison with rat forebrain extracts, adrenal gland extracts exhibited TH hyperphosphorylation at Ser(19), Ser(31), and Ser(40), as well as reduced phosphatase activity selectively toward phosphorylated TH. Because the B'beta regulatory subunit of PP2A is expressed in brain but not in adrenal glands, we tested the hypothesis that PP2A/B'beta is a specific TH phosphatase. In catecholamine-secreting PC12 cells, inducible expression of B'beta decreased both N-terminal Ser phosphorylation and in situ TH activity, whereas inducible silencing of endogenous B'beta had the opposite effect. Furthermore, PP2A/B'beta directly dephosphorylated TH in vitro. As to specificity, other PP2A regulatory subunits had negligible effects on TH activity and phosphorylation in situ and in vitro. Whereas B'beta was highly expressed in dopaminergic cell bodies in the substantia nigra, the PP2A regulatory subunit was excluded from TH-positive terminal fields in the striatum and failed to colocalize with presynaptic markers in general. Consistent with a model in which B'beta enrichment in neuronal cell bodies helps confine catecholamine synthesis to axon terminals, TH phosphorylation was higher in processes than in somata of dopaminergic neurons. In summary, we show that B'beta recruits PP2A to modulate TH activity in a tissue- and cell compartment specific fashion.