Protein-tyrosine phosphatases (PTPs) are critically involved in regulation of signal transduction processes. Members of this class of enzymes are considered attractive therapeutic targets in several disease states, e.g. diabetes, cancer, and inflammation. However, most reported PTP inhibitors have been phosphorus-containing compounds, tight binding inhibitors, and/or inhibitors that covalently modify the enzymes. We therefore embarked on identifying a general, reversible, competitive PTP

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... or that could be used as a common scaffold for lead optimization for specific PTPs. We here report the identification of 2-(oxalylamino)-benzoic acid (OBA) as a classical competitive inhibitor of several PTPs. X-ray crystallography of PTP1B complexed with OBA and related non-phosphate low molecular weight derivatives reveals that the binding mode of these molecules to a large extent mimics that of the natural substrate including hydrogen bonding to the PTP signature motif. In addition, binding of OBA to the active site of PTP1B creates a unique arrangement involving Asp 181 , Lys 120 , and Tyr 46 . PTP inhibitors are essential tools in elucidating the biological function of specific PTPs and they may eventually be developed into selective drug candidates. The unique enzyme kinetic features and the low molecular weight of OBA makes it an ideal starting point for further optimization.