The PPP1R3 gene is located on chromosome 7q31, and encodes protein phosphatase 1 (regulatory 3). It has been reported that the inactivation of various phosphatase proteins causes abnormalities in cell division and cell growth systems. We analyzed alterations in the PPP1R3 gene and its relationship to tumor progression and metastasis. Deletion mutants of exons containing mutations were prepared and assayed for intranuclear transcription activity. SSCP analysis of PPP1R3 showed abnormal patterns in 6 (12%) of the 50 colorectal cancers. DNA sequencing of the 6 samples showing abnormal SSCP patterns confirmed point mutations in exon 4 in 4 samples, and in exon 1 in 2 samples. PPP1R3 gene alterations correlated with lymph node and liver metastases. Enhancement of luciferase activity by the full PPP1R3 gene was confirmed. However, when point mutation-containing exon 1 or 4 deletion mutants were examined for luciferase activity, enhancement of activity was decreased in the exon 1 deletion mutants, while no enhancement of the activity was noted in the exon 4 deletion mutants. These findings suggest that protein phosphatase 1 (regulatory 3) protein is involved in intracellular processes in some colorectal cancers and may play a role in metastasis.