Attention has focused on the regulation of the eucaryotic cell division cycle since the protein kinase p34cdc2 was identified as a key enzyme in mitotic induction. The level of this kinase remains constant throughout the cell cycle but its activity alters, particularly before M phase. Although the factors regulating cdc2 activity are still unknown, there is increasing evidence that it is influenced by p34cdc2 dephosphorylation. Protein phosphatase inhibitor-2 (I2) is a specific inhibitor of phosphatase type-1, which with type-2A is one of the two principal Ser(P) and Thr(P) phosphatases. Here we show that the level of I2, assayed by immunofluorescence staining, activity measurements, western immunoblotting and metabolic labelling, oscillates during the cell cycle in rat fibroblasts, peaking at S phase and mitosis. Moreover, when we inhibited I2 in vivo by microinjection of anti-I2 antibodies in S-phase cells, the pseudo-mitotic cellular response to injected p34cdc2 was restored, indicating that I2 might have a role in the modulation of p34cdc2 activity.