Liver and muscle glycogen phosphorylases, which are products of distinct genes, are both activated by covalent phosphorylation, but in the unphosphorylated (b) state, only the muscle isozyme is efficiently activated by the allosteric activator AMP. The different responsiveness of the phosphorylase isozymes to allosteric ligands is important for the maintenance of tissue and whole body glucose homeostasis. In an attempt to understand the structural determinants of differential sensitivity of the muscle and liver isozymes to AMP, we have developed a bacterial expression system for the liver enzyme, allowing native and engineered proteins to be expressed and characterized. Engineering of the single amino acid substitutions Thr48Pro, Met197Thr and the double mutant Thr48Pro, Met197Thr in liver phosphorylase, and Pro48Thr in muscle phosphorylase, did not qualitatively change the response of the two isozymes to AMP. These sites had previously been implicated in the configuration of the AMP binding site. However, when nine amino acids among the first 48 in liver phosphorylase were replaced with the corresponding muscle phosphorylase residues (L1M2-48L49-846), the engineered liver enzyme was activated by AMP to a higher maximal activity than native liver phosphorylase. Interestingly, the homotropic cooperativity of AMP binding was unchanged in the engineered phosphorylase b protein, and heterotropic cooperativity between the glucose-1-phosphate and AMP sites was only slightly enhanced. The native liver, native muscle and L1M2-48L49-846 phosphorylases were converted to the a form by treatment with purified phosphorylase kinase; the maximal activity of the chimeric a enzyme was greater than the native liver a enzyme and approached that of muscle phosphorylase a. From these results we suggest that tissue-specific phosphorylase isozymes have evolved a complex mechanism in which the N-terminal 48 amino acids modulate intrinsic activity (Vmax), probably by affecting subunit interactions, and other, as yet undefined regions specify the allosteric interactions with ligands and substrates.