As the phosphoinositol-3-kinase antagonist in the PI3K pathway, the PTEN tumor suppressor exerts phosphatase activity on diacylphosphatidylinositol triphosphate in the plasma membrane. Even partial loss of this activity enhances tumorigenesis, but a mechanistic basis for this aspect of PTEN physiology has not yet been established. It was recently proposed that PTEN mutations have dominant-negative effects in cancer via PTEN dimers. We show that PTEN forms homodimers in vitro, and determine a structural model of the complex from SAXS and Rosetta docking studies. Our findings shed new light on the cellular control mechanism of PTEN activity. Phosphorylation of the unstructured C-terminal tail of PTEN reduces PTEN activity, and this result was interpreted as a blockage of the PTEN membrane binding interface through this tail. The results presented here instead suggest that the C-terminal tail functions in stabilizing the homodimer, and that tail phosphorylation interferes with this stabilization.