Myosin light chain phosphatase consists of three subunits, a 38-kDa catalytic subunit, a large 110-130-kDa myosin binding subunit, and a small subunit of 20-21 kDa. The catalytic subunit and the large subunit have been well characterized. The small subunit has been cloned and studied from smooth muscle, but little is known about its function and specificity in the other muscles such as cardiac muscle. In this study, cDNAs for heart-specific small subunit isoforms, hHS-M(21), were isolated and characterized. Evidence was obtained from an analysis of genome to suggest that the small subunit was the product of the same gene as the large subunit. Using permeabilized renal artery preparation and permeabilized cardiac myocytes, it was shown that the small subunit increased sensitivity to Ca(2+) in muscle contraction. It was also shown using an overlay assay that hHS-M(21) bound the large subunit. Mapping experiments demonstrated that the binding domain and the domain involved in the increasing Ca(2+) sensitivity mapped to the same N-terminal region of hHS-M(21). These observations suggest that the heart-specific small subunit hHS-M(21) plays a regulatory role in cardiac muscle contraction by its binding to the large subunit.