Androgen receptor (AR) is phosphorylated at multiple sites in response to ligand binding, but the functional consequences and mechanisms regulating AR phosphorylation remain to be established. We observed initially that okadaic acid, an inhibitor of the major PPP family serine/threonine phosphatases PP2A and protein phosphatase 1 (PP1), had cell type-dependent effects on AR expression. More specific inhibitors of PP2A (fostriecin) and PP1 (tautomycin and siRNA against the PP1alpha catalytic subunit) demonstrated that PP1 and protein phosphatase 2A had opposite effects on AR protein and transcriptional activity. PP1 inhibition enhanced proteasome-mediated AR degradation, while PP1alpha overexpression increased AR expression and markedly enhanced AR transcriptional activity. Coprecipitation experiments demonstrated an AR-PP1 interaction, while immunofluorescence and nuclear-cytoplasmic fractionation showed androgen-stimulated nuclear translocation of both AR and PP1 in prostate cancer cells. Studies with phosphospecific AR antibodies showed that PP1 inhibition dramatically increased phosphorylation of Ser-650, a site in the AR hinge region shown to mediate nuclear export. Significantly, PP1 inhibition caused a marked decrease in nuclear localization of the wild-type AR, but did not alter total or nuclear levels of a S650A mutant AR. These findings reveal a critical role of PP1 in regulating AR protein stability and nuclear localization through dephosphorylation of Ser-650. Moreover, AR may function as a PP1 regulatory subunit and mediate PP1 recruitment to chromatin, where it can modulate transcription and splicing.