PDE4 splice variants are classified into long and short forms depending on the presence or absence of two unique N-terminal domains termed upstream conserved regions 1 and 2 (UCR1 and -2). We have shown previously that the UCR module mediates dimerization of PDE4 long forms, whereas short forms, which lack UCR1, behave as monomers. In the present study, we demonstrate that dimerization is an essential structural element that determines the regulatory properties and inhibitor sensitivities of PDE4 enzymes. Comparing the properties of the dimeric wild type PDE4D3 with several monomeric mutant PDE4D3 constructs revealed that disruption of dimerization ablates the activation of PDE4 long forms by either protein kinase A phosphorylation or phosphatidic acid binding. Moreover, the analysis of heterodimers consisting of a catalytically active and a catalytically inactive PDE4D3 subunit indicates that protein kinase A phosphorylation of both subunits is essential to fully activate PDE4 enzymes. In addition to affecting enzyme regulation, disruption of dimerization reduces the sensitivity of the enzymes toward the prototypical PDE4 inhibitor rolipram. Parallel binding assays indicated that this shift in rolipram sensitivity is likely mediated by a decrease in the number of inhibitor binding sites in the high affinity rolipram binding state. Thus, although dimerization is not a requirement for high affinity rolipram binding, it functions to stabilize PDE4 long forms in their high affinity rolipram binding conformation. Taken together, our data indicate that dimerization defines the properties of PDE4 enzymes and suggest a common structural and functional organization for all PDEs.