The sulfotyrosine peptide, IRK1154, is based on the corresponding phosphotyrosine segment of the insulin receptor kinase domain (IRK) and is a known inhibitor of the function of the protein tyrosine phosphatase, PTP1B. Two-dimensional NMR spectroscopy, in the transferred nuclear Overhauser effect (NOE) enhancement experiment, was used to obtain information concerning the bound structure of this peptide. Computer-simulated docking experiments, followed by molecular dynamics simulations in a fully hydrated model, provided information concerning the site-specific interactions influencing the bound peptide. Using the Structural and orientational information from the NMR studies as a guide, together with the X-ray coordinates for PTP1B and IRK, a detailed model of the binding of these two proteins was developed. The interface between the two entities is described, and the sites of positive interactions are identified. Potential sources of destabilizing interactions, necessary for dissociation of the two enzymes, were also found.