A scintillation proximity assay (SPA) is described, which quantitates the ability of compounds to inhibit the binding interaction of a select phosphopeptide with the tandem SH2 domains of the ZAP-70 protein tyrosine kinase. The method is based on the ability of a truncated ZAP-70 tandem SH2 domain-derived peptide to bind an 125I-labeled, diphosphorylated peptide corresponding to the human T-cell receptor ζ-1 immunoglobulin receptor family tyrosine-based activation motif (ITAM). ZAP-70 tandem SH2 domain peptide was biotinylated and bound to streptavidin-coated SPA beads. 125I-labeled ζ-1 ITAM ([125I]-ζ-1 ITAM) bound to immobilized ZAP-70 tandem SH2 domain peptide in a saturable, time- and peptide concentration-dependent fashion. Unlabeled diphosphorylated ζ-1 ITAM competed binding with an ICso value equal to approximately 10-15 nM. Binding of ζ-1 ITAM to the ZAP-70 tandem SH2 domain was dependent on the cooperative interaction of the dual phosphotyrosine residues. Unlabeled monotyrosyl-phosphorylated peptides failed to compete with [125I]-ζ-1 ITAM binding to ZAP-70 SH2 domain. Also, labeled monotyrosyl-phosphorylated peptides failed to associate with the ZAP-70 SH2 domain in direct binding studies. Association and dissociation binding kinetics were determined to be extremely rapid at room temperature, reaching equilibrium within 5 min. The Kd for [125I]-ζ-1 ITAM binding to ZAP-70 tandem SH2 domain peptide was determined by Scatchard analysis to be 1.5-2 nM. The SPA assay was adapted for automated, high-capacity screening, which allowed evaluation of 23,040 small molecular weight compounds per day. The assay is useful for both drug discovery and as a research tool for the study of binding interactions between signal-transducing molecules critical for T-cell activation.