Calcineurin is a widely expressed and highly conserved Ser/Thr phosphatase. Calcineurin is inhibited by the immunosuppressant drug cyclosporine A (CsA) or tacrolimus (FK506). The critical role of CsA/FK506 as an immunosuppressant following transplantation surgery provides a strong incentive to understand the phosphatase calcineurin. Here we uncover a novel regulatory pathway for cyclic AMP (cAMP) signaling by the phosphatase calcineurin which is also evolutionarily conserved in Caenorhabditis elegans. We found that calcineurin binds directly to and inhibits the proteosomal degradation of cAMP-hydrolyzing phosphodiesterase 4D (PDE4D). We show that ubiquitin conjugation and proteosomal degradation of PDE4D are controlled by a cullin 1-containing E(3) ubiquitin ligase complex upon dual phosphorylation by casein kinase 1 (CK1) and glycogen synthase kinase 3beta (GSK3beta) in a phosphodegron motif. Our findings identify a novel signaling process governing G-protein-coupled cAMP signal transduction-opposing actions of the phosphatase calcineurin and the CK1/GSK3beta protein kinases on the phosphodegron-dependent degradation of PDE4D. This novel signaling system also provides unique functional insights into the complications elicited by CsA in transplant patients.