Ser-133 phosphorylation of CREB within the kinase-inducible domain (KID) promotes target gene activation via complex formation with the KIX domain of the coactivator CBP. Concurrent phosphorylation of CREB at Ser-142 inhibits transcriptional induction via an unknown mechanism. Unstructured in the free state, KID folds into a helical structure upon binding to KIX. Using site-directed mutagenesis based on the NMR structure of the KID:KIX complex, we have examined the mechanisms by which Ser-133 and Ser-142 phosphorylation regulate CREB activity. Our results indicate that phospho-Ser-133 stablizes whereas phospho-Ser-142 disrupts secondary structure-mediated interactions between CREB and CBP. Thus, differential phosphorylation of CREB may form the basis by which upstream signals regulate the specificity of target gene activation.