Protein tyrosine phosphatases (PTPs) play multiple roles in many physiological processes. Overexpression of the PTPs has been shown to be associated with cellular toxicity, which may also lead to the deletion of the respective gene from stable cell clones. We also observed that PTP-1B over-expression in CHO and HEK293 stable cell clones led to cytotoxicity and low revival rates during clone generation and maintenance. To address these issues, bacmid transposition technology was utilized to generate recombinant PTP-1B baculovirus, and Spodoptera frugiperda (Sf9 and Sf21) insect cell lines were infected with the virus. The data obtained on expression and activity of the PTP-1B highlights clear advantage of the recombinant baculovirusinsect cell expression system over the mammalian cell line technique due to increase in enzyme activity, strongly inhibited by phosphatase specific inhibitor RK682. Possible application of the expression system for producing active enzymes in bulk quantity for a new drug discovery is also discussed.