The eyes absent (Eya) genes encode a family of proteins that combine the functions of transcriptional cofactors, signal transducers and enzymes, namely protein tyrosine phosphatases. The latter activity resides in the highly conserved C-terminal Eya domain (ED). Here, we investigated the substrate specificity of the Arabidopsis thaliana homologue (AtEya) by using low-molecular-weight compounds and synthetic phosphotyrosine (pY)-containing peptides that correspond either to phosphorylation sites in proteins or to peptides that were selected through the screening of a combinatorial peptide library. AtEya displayed modest peptide substrate specificity and was sensitive to charges adjacent to pY. In general, the presence of acidic residues on the N-terminal side of the phosphorylation site was critical for catalysis, whereas basic amino acids seemed to be preferred with respect to high-affinity binding. We also detected significant acyl phosphatase activity of AtEya; this suggests that Eya proteins might have further substrates in vivo. In addition, we analysed the phosphatase activity of a number of variants of the mouse Eya1 protein that harbours single point mutations that were associated with branchio-oto-renal syndrome (BOR), branchio-oto syndrome (BO) and ocular defects, respectively, in humans. While BOR mutations led to a significantly reduced phosphatase activity, BO mutants as well as those that are associated with ocular defects only displayed activity that was similar to wild-type levels.