Cell growth, cell cycle, and apoptosis are regulated by reversible phosphorylation of the target proteins. To elucidate roles of protein phosphatases in cancer, we have studied for the recent decade on neoplastic alterations of three protein phosphatases families, serine/threonine phosphatases (PP), tyrosine phosphatases (PTP), and dual specificity phosphatases (DSP) in hepatocarcinogenesis and rat ascites hepatomas. We found that both levels of PP1α mRNA and PP1α protein are increased in ascities hepatomas compared with those in normal livers and the increased PP1 accumulated in non-nuclear membrane fraction and nuclei. The increase in PP1α mRNA expression in ascites hepatomas was at least in part due to the enhanced promoter activity of PP1α gene. Then we examined the expression patterns of PTP genes after partial hepatectomy and found that they could be classified into four groups. In group 1 (PTP-S and PTPH1), the mRNA levels increased rapidly, reached a maximum 7 h after partial hepatectomy, remained at a plateau for 1-2 days and the decreased gradually. In group 2 (PTP-1, GLEPP1, and LRP), the mRNA level showed two peaks on days 1 and 5, and then decreased gradually. In group 3 (PTPγ, PTPδ, and LAR), the mRNA levels remained constant for the first 5 days and increased over the control levels after day 7. In group 4 (PTP1D and PTPG1), the mRNA levels remain constant. Out of the four groups, the group 3, particularly PTPδ mRNA was drastically reduced in hepatoma tissues. Among MKP family, the MKP-2 mRNA level was markedly increased with expression of malignant phenotypes of hepatomas. The significance of these alterations will be discussed in relation to malignant phenotypes of hepatoma and other cancers.