Most aspects of cellular events are regulated by a series of protein phosphorylation and dephosphorylation processes. Abi (Abl interactor protein) functions as a substrate adaptor protein for Abl and a core member of the WAVE complex, relaying signals from Rac to Arp2/3 complex and regulating actin dynamics. It is known that the recruitment of Abi into the lamella promotes polymerization of actin, although how it does this is unclear. In this study, we found PTP61F, a Drosophila homolog of mammalian PTP1B, can reverse the Abl phosphorylation of Abi and colocalizes with Abi in Drosophila S2 cells. Abi can be translocalized from the cytosol to the cell membrane by either increasing Abl or reducing endogenous PTP61F. This reciprocal regulation of Abi phosphorylation is also involved in modulating Abi protein level, which is thought to affect the stability of the WAVE complex. Using mass spectrometry, we identified several important tyrosine phosphorylation sites in Abi. We compared the translocalization and protein half-life of wild type (wt) and phosphomutant Abi and their abilities to restore the lamellipodia structure of the Abi-reduced cells. We found the phosphomutant to have reduced ability to translocalize and to have a protein half-life shorter than that of wt Abi. We also found that although the wt Abi could fully restore the lamellipodia structure, the phosphomutant could not. Together, these findings suggest that the reciprocal regulation of Abi phosphorylation by Abl and PTP61F may regulate the localization and stability of Abi and may regulate the formation of lamella.