PTP-MEG2 is an intracellular protein tyrosine phosphatase with a putative lipid-binding domain at the N-terminus. The present study reports expression, purification, and characterization of the full-length form of the enzyme plus a truncated form containing the catalytic domain alone. Full-length PTP-MEG2 was expressed with an adenovirus system and purified from cytosolic extracts of human 293 cells infected with the recombinant adenovirus. The purification scheme included chromatographic separation of cytosolic extracts on fast flow Q-Sepharose, heparin-agarose, l-histidyldiazobenzylphosphonic acid agarose, and hydroxylapatite. The enrichment of PTP-MEG2 from the cytosol was about 120-fold. The truncated form of PTP-MEG2 was expressed in E. coli cells as a non-fusion protein and purified by using a chromatographic procedure similar to that used for the full-length enzyme. The purified full-length and truncated enzymes showed single polypeptide bands on SDS-polyacrylamide gel electrophoresis under reducing conditions and behaved as monomers on gel exclusion chromatography. With para-nitrophenylphosphate and phosphotyrosine as substrates, both forms of the enzyme exhibited classical Michaelis-Menten kinetics. Their responses to pH, ionic strength, metal ions, and protein phosphatase inhibitors are similar to those observed with other characterized tyrosine phosphatases. Compared with full-length PTP-MEG2, the truncated DeltaPTP-MEG2 displayed significantly higher V(max) and lower K(m) values, suggesting that the N-terminal putative lipid-binding domain may have an inhibitory role. The full-length and truncated forms of PTP-MEG2 were also expressed as GST fusion proteins in E. coli cells and purified to near homogeneity through affinity columns. However, the specific phosphatase activities of the GST fusion proteins were 10-25-fold below those obtained with the correspondent non-fusion proteins.