Protein-tyrosine phosphatase 1B (PTP1B) is a physiological regulator of glucose homeostasis and adiposity and is a drug target for the treatment of obesity and diabetes. Here we identify pyruvate kinase M2 (PKM2) as a novel PTP1B substrate in adipocytes. PTP1B deficiency leads to increased PKM2 total tyrosine and Tyr(105) phosphorylation in cultured adipocytes and in vivo. Substrate trapping and mutagenesis studies identify PKM2 Tyr-105 and Tyr-148 as key sites that mediate PTP1B-PKM2 interaction. In addition, in vitro analyses illustrate a direct effect of Tyr-105 phosphorylation on PKM2 activity in adipocytes. Importantly, PTP1B pharmacological inhibition increased PKM2 Tyr-105 phosphorylation and decreased PKM2 activity. Moreover, PKM2 Tyr-105 phosphorylation is regulated nutritionally, decreasing in adipose tissue depots after high-fat feeding. Further, decreased PKM2 Tyr-105 phosphorylation correlates with the development of glucose intolerance and insulin resistance in rodents, non-human primates, and humans. Together, these findings identify PKM2 as a novel substrate of PTP1B and provide new insights into the regulation of adipose PKM2 activity.