Serine/Threonine phosphoprotein phosphatases (PPPs, PP1-PP7) are conserved metalloenzymes and central to intracellular signaling in eukaryotes, but the details of their regulation is poorly understood. To address this, we performed genome-wide CRISPR knockout and focused base editor screens in PPP perturbed conditions to establish a high-resolution functional map of PPP regulation that pinpoints novel regulatory mechanisms. Through this, we identify the orphan reductase CYB5R4 as an evolutionarily conserved activator of PP4 and PP6, but not the closely related PP2A. Heme binding is essential for CYB5R4 function and mechanistically involves the reduction of the metal ions in the active site. Importantly, CYB5R4-mediated activation of PP4 is critical for cell viability when cells are treated with DNA damage-inducing agents known to cause oxidative stress. The discovery of a dedicated PPP reductase points to shared regulatory principles with protein tyrosine phosphatases, where specific enzymes dictate activity by regulating the active site redox state. In sum, our work provides a resource for understanding PPP function and the regulation of intracellular signaling.