Glycogen synthase kinase 3 beta (GSK3 beta) plays a key role in insulin and Wnt signaling, phosphorylating downstream targets by default, and becoming inhibited following the extracellular signaling event. The crystal structure of human GSK3 beta shows a catalytically active conformation in the absence of activation-segment phosphorylation, with the sulphonate of a buffer molecule bridging the activation-segment and N-terminal domain in the same way as the phosphate group of the activation-segment phospho-Ser/Thr in other kinases. The location of this oxyanion binding site in the substrate binding cleft indicates direct coupling of P+4 phosphate-primed substrate binding and catalytic activation, explains the ability of GSK3 beta to processively hyperphosphorylate substrates with Ser/Thr pentad-repeats, and suggests a mechanism for autoinhibition in which the phosphorylated N terminus binds as a competitive pseudosubstrate with phospho-Ser 9 occupying the P+4 site.