The tumor suppressor PTEN regulates cell migration, growth, and survival by removing the 3'-phosphate of phosphoinositides. Exposure of purified PTEN or of cells to H(2)O(2) resulted in inactivation of PTEN in a time- and H(2)O(2) concentration-dependent manner. Analysis of various cysteine mutants, including mass spectrometry of tryptic peptides, indicated that the essential Cys(124) residue in the active site of PTEN specifically forms a disulfide with Cys(71) during oxidation by H(2)O(2). The reduction of H(2)O(2)-oxidized PTEN in cells appears to be mediated predominantly by thioredoxin. Thus, thioredoxin was more efficient than glutaredoxin, glutathione, or a 14-kDa thioredoxin-like protein with regard to the reduction of oxidized PTEN in vitro. Thioredoxin co-immunoprecipitated with PTEN from cell lysates; and incubation of cells with 2,4-dinitro-1-chlorobenzene (an inhibitor of thioredoxin reductase) delayed the reduction of oxidized PTEN, whereas incubation with buthioninesulfoximine (an inhibitor of glutathione biosynthesis) did not. These results suggest that the reversible inactivation of PTEN by H(2)O(2) might be important for the accumulation of 3'-phosphorylated phosphoinositides and that the uncontrolled generation of H(2)O(2) associated with certain pathological conditions might contribute to cell proliferation by inhibiting PTEN function.