Rho-associated kinase (Rho-kinase), which is activated by the small GTPase Rho, phosphorylates myosin-binding subunit (MBS) of myosin phosphatase and thereby inactivates the phosphatase activity in vitro. Rho-kinase is thought to regulate the phosphorylation state of the substrates including myosin light chain (MLC), ERM (ezrin/radixin/moesin) family proteins and adducin by their direct phosphorylation and by the inactivation of myosin phosphatase. Here we identified the sites of phosphorylation of MBS by Rho-kinase as Thr-697, Ser-854 and several residues, and prepared antibody that specifically recognized MBS phosphorylated at Ser-854. We found by use of this antibody that the stimulation of MDCK epithelial cells with tetradecanoylphorbol-13-acetate (TPA) or hepatocyte growth factor (HGF) induced the phosphorylation of MBS at Ser-854 under the conditions in which membrane ruffling and cell migration were induced. Pretreatment of the cells with Botulinum C3 ADP-ribosyltransferase (C3), which is thought to interfere with Rho functions, or Rho-kinase inhibitors inhibited the TPA- or HGF-induced MBS phosphorylation. The TPA stimulation enhanced the immunoreactivity of phosphorylated MBS in the cytoplasm and membrane ruffling area of MDCK cells. In migrating MDCK cells, phosphorylated MBS as well as phosphorylated MLC at Ser-19 were localized in the leading edge and posterior region. Phosphorylated MBS was localized on actin stress fibers in REF52 fibroblasts. The microinjection of C3 or dominant negative Rho-kinase disrupted stress fibers and weakened the accumulation of phosphorylated MBS in REF52 cells. During cytokinesis, phosphorylated MBS, MLC and ERM family proteins accumulated at the cleavage furrow, and the phosphorylation level of MBS at Ser-854 was increased. Taken together, these results indicate that MBS is phosphorylated by Rho-kinase downstream of Rho in vivo, and suggest that myosin phosphatase and Rho-kinase spatiotemporally regulate the phosphorylation state of Rho-kinase substrates including MLC and ERM family proteins in vivo in a cooperative manner.