Mitogen-activated protein kinases (MAPKs) are key regulators of cellular physiology and immune responses, and abnormalities in MAPKs are implicated in many diseases. MAPKs are activated by MAPK kinases through phosphorylation of the threonine and tyrosine residues in the conserved Thr-Xaa-Tyr domain, where Xaa represents amino acid residues characteristic of distinct MAPK subfamilies. Since MAPKs play a crucial role in a variety of cellular processes, a delicate regulatory network has evolved to control their activities. Over the past two decades, a group of dual specificity MAPK phosphatases (MKPs) has been identified that deactivates MAPKs. Since MAPKs can enhance MKP activities, MKPs are considered as an important feedback control mechanism that limits the MAPK cascades. This review outlines the role of MKP-1, a prototypical MKP family member, in physiology and disease. We will first discuss the basic biochemistry and regulation of MKP-1. Next, we will present the current consensus on the immunological and physiological functions of MKP-1 in infectious, inflammatory, metabolic, and nervous system diseases as revealed by studies using animal models. We will also discuss the emerging evidence implicating MKP-1 in human disorders. Finally, we will conclude with a discussion of the potential for pharmacomodulation of MKP-1 expression.