The catalytic C subunit of protein phosphatase 2A2 was methylated with an apparent km of about 0.1 microM by purified preparations of a methyltransferase from bovine brain. This methylation was inhibited by okadaic acid and microcystin-LR half-maximally at 40 nM and 60 nM, respectively. The extent of inhibition depended on the protein phosphatase concentration in the incubations, but was independent of the methyltransferase concentration. The results demonstrate that okadaic acid and microcystin-LR directly inhibit the methylation of protein phosphatase 2A. The results are consistent with the idea that okadaic acid and microcystin-LR act, at least in part, by binding to the carboxyl terminus of the C subunit of protein phosphatase 2A thereby preventing access of the methyltransferase to its target site, the C subunit carboxyl terminal Leu309.