Altered function of the protein tyrosine phosphatase (PTP) Lyp (PTPN22) has been implicated in the pathogenesis of a number of human diseases, and so accurate assessment of its functional activity is needed to further our understanding of its biology. We have developed an in vitro method to measure the specific catalytic activity of the Lyp phosphatase. Lyp is captured from cell lysates using an anti-Lyp monoclonal antibody coated 96-well plate, and activity measured by dephosphorylation of a fluorescent substrate, 6,8-difluoro-4-methylumbelliferyl phosphate (DiFMUP). The amount of protein is measured using an anti-Lyp HRP conjugate, with reference to a standard curve generated with purified Lyp. These two measurements are then used to calculate the specific phosphatase activity. We used this assay to show that the specific activity of the Lyp phosphatase is decreased by H(2)O(2) in Jurkat T cells and primary CD4+ T cells. We also modified this assay to measure the specific activity of CD45, the other main PTP regulating T cell receptor (TCR) signalling, in order to compare the relative susceptibility of CD45 and Lyp to oxidation by H(2)O(2). By measuring specific activity in Jurkat T cells and primary CD4+ T cells, we demonstrated that CD45 is more susceptible to oxidation by H(2)O(2) when compared to Lyp. Reduced function of CD45 and Lyp has been associated with human immune mediated inflammatory diseases, and a differential susceptibility to oxidation could be an important regulatory mechanism associated with both physiological and pathological changes in signalling through the TCR.