PTP-BL is a large phosphatase that is implicated in cellular processes as diverse as cytokinesis, actin-cytoskeletal rearrangement, and apoptosis. Five PDZ domains mediate its cellular role by binding to the C termini of target proteins, forming multiprotein complexes. The second PDZ domain (PDZ2) binds to the C termini of the tumor suppressor protein APC and the LIM domain-containing protein RIL; however, in one splice variant, PDZ2as, a 5 residue insertion abrogates this binding. The insert causes distinct structural and dynamical changes in the alternatively spliced PDZ2: enlarging the L1 loop between beta2 and beta3, both lengthening and changing the orientation of the alpha2 helix, giving the base of the binding pocket less flexibility to accommodate ligands, and destabilizing the entire domain. These changes render the binding pocket incapable of binding C termini, possibly having implications in the functional role of PTP-BL.