PASTICCINO2 (PAS2), a member of the protein Tyr phosphatase-like family, is conserved among all eukaryotes and is characterized by a mutated catalytic site. The cellular functions of the Tyr phosphatase-like proteins are still unknown, even if they are essential in yeast and mammals. Here, we demonstrate that PAS2 interacts with a cyclin-dependent kinase (CDK) that is phosphorylated on Tyr and not with its unphosphorylated isoform. Phosphorylation of the conserved regulatory Tyr-15 is involved in the binding of CDK to PAS2. Loss of the PAS2 function dephosphorylated Arabidopsis thaliana CDKA;1 and upregulated its kinase activity. In accordance with its role as a negative regulator of the cell cycle, overexpression of PAS2 slowed down cell division in suspension cell cultures at the G2-to-M transition and early mitosis and inhibited Arabidopsis seedling growth. The latter was accompanied by altered leaf development and accelerated cotyledon senescence. PAS2 was localized in the cytoplasm of dividing cells but moved into the nucleus upon cell differentiation, suggesting that the balance between cell division and differentiation is regulated through the interaction between CDKA;1 and the antiphosphatase PAS2.