Calcineurin is a serine/threonine protein phosphatase that is highly conserved from yeast to human and plays a critical role in many physiological processes. Regulators of calcineurin (RCANs) are a family of endogenous calcineurin regulators, which are capable of inhibiting the catalytic activity of calcineurin in vivo and in vitro. In this study, we first characterized the biochemical properties of yeast calcineurin and its endogenous regulator Rcn1, a yeast homolog of RCAN1. Our data show that Rcn1 inhibits yeast calcineurin toward pNPP substrate with a noncompetitive mode; and Rcn1 binds cooperatively to yeast calcineurin through multiple low-affinity interactions at several docking regions. Next, we reinvestigated the mechanism underlying the inhibition of mammalian calcineurin by RCAN1 using a combination of biochemical, biophysical, and computational methods. In contrast to previous observations, RCAN1 noncompetitively inhibits calcineurin phosphatase activity toward both pNPP and phospho-RII peptide substrates by targeting the enzyme active site in part. Re-analysis of previously reported kinetic data reveals that the RCAN1 concentrations used were too low to distinguish between the inhibition mechanisms [Chan B et al. (2005) Proc Natl Acad Sci USA 102, 13075]. The results presented in this study provide new insights into the interaction between calcineurin and RCAN1/Rcn1.