Exploring the regulation of signaling by Extracellular signal-regulated kinase (ERK) is of fundamental importance for understanding several pathophysiological processes. Members of the dual-specificity phosphatase (DUSP) family are known to regulate the spatio-temporal signaling of ERK. However, some DUSP family members are devoid of catalytic activity and we have no information on whether and how these pseudophosphatases regulate ERK signaling. In the current work we investigated the pseudophosphatase STYX. We reasoned that by competing with active DUSPs, STYX would protect ERK from de-activation. Counter our expectations, depletion of STYX in various cell lines resulted in a robust increase of ERK phosphorylation. Conversely, overexpression of STYX inhibited ERK activation. We employed computational modeling to predict the most likely mechanism of action for STYX. The most likely model suggested STYX to act as a nuclear anchor for ERK, retarding nucleo-cytoplasmic ERK shuttling. In fact, STYX localizes to the nucleus. Moreover, using YFP-complementation, we show that STYX interacts with ERK in the nucleus. This interaction is direct because in vitro translated STYX interacts with ERK2. Using fluorescence recovery after photobleaching (FRAP) microscopy we show that STYX delays export of ERK2 from the nucleus and that the STYX-ERK complex does not leave the nucleus. STYX also exhibits cross-talk with DUSPs. Depletion of DUSP4 (nuclear DUSP) abrogates the effect of STYX knockdown on ERK signaling, while depletion of DUSP6 (cytosolic DUSP) augments it. This is consistent with STYX acting mainly in the nucleus. Finally, we determined whether STYX would regulate the impact of ERK on cell fate decisions using PC12 cells as a model. Overexpression of STYX reduced ERK activation and accordingly, resulted in a strong inhibition of PC12 cell differentiation. Our work shows that the pseudophosphatase STYX directly regulates ERK signaling, and thereby modulates cell fate decisions.