Protein tyrosine phosphatases (PTPs) possess a mobile, conserved catalytic loop, the WPD-loop, which brings an aspartic acid into the active site where it acts as an acid/base catalyst. Prior experimental and computational studies, focused on the human enzyme PTP1B and the PTP from Yersinia pestis, YopH, suggested that loop conformational dynamics are important in regulating both catalysis and evolvability. Also, work on Chimeras of YopH bearing parts of the WPD-loop sequence from PTP1B demonstrated unusual structural perturbations and reduced activity. In the present study, we have generated a chimeric protein in which the WPD-loop of YopH is transposed into PTP1B, and eight chimeras that systematically restored the loop sequence back to native PTP1B. Of these, four chimeras were soluble and were subjected to detailed biochemical and structural characterization, and a computational analysis of their WPD-loop dynamics in catalysis. These chimeras maintain backbone structural integrity, with somewhat slower rates than either wild-type parent, despite unaltered chemical mechanisms and transition states. The chimeric proteins’ WPD-loops differ significantly in their relative stability and rigidity. In particular, the open WPD-loops sample multiple metastable and interconverting conformations. The time required for interconversion, coupled with electrostatic effects revealed by simulations, likely accounts for the activity differences between chimeras, and relative to the native enzymes. These differences in loop dynamics affect both the pH dependency of catalysis and turnover rate. Our results further the understanding of connections between enzyme activity and the dynamics of catalytically important groups, particularly the effects of non-catalytic residues on key conformational equilibria.