Phosphotyrosine-binding domains, typified by the SH2 (Src homology 2) and PTB domains, are critical upstream components of signal transduction pathways. The E3 ubiquitin ligase Hakai targets tyrosine-phosphorylated E-cadherin via an uncharacterized domain. In this study, the crystal structure of Hakai (amino acids 106–206) revealed that it forms an atypical, zinc-coordinated homodimer by utilizing residues from the phosphotyrosine-binding domain of two Hakai monomers. Hakai dimerization allows the formation of a phosphotyrosine-binding pocket that recognizes specific phosphorylated tyrosines and flanking acidic amino acids of Src substrates, such as E-cadherin, cortactin and DOK1. NMR and mutational analysis identified the Hakai residues required for target binding within the binding pocket, now named the HYB domain. ZNF645 also possesses a HYB domain but demonstrates different target specificities. The HYB domain is structurally different from other phosphotyrosine-binding domains and is a potential drug target due to its novel structural features.