We have performed molecular dynamics simulations of the phosphorylation domain (PD) of the regulatory light chain (RLC) of smooth muscle myosin, to gain insight into the thermodynamic principles governing the phosphorylation-induced disorder-to-order transition. Simulations were performed in explicit water under near-physiological conditions, starting with an ideal α-helix. In the absence of phosphorylation, the helical periodicity of the peptide was disrupted at residues T9-K11, while phosphorylation significantly favored the helical periodicity, in agreement with experimental data. Using the MM/PBSA approach, we calculated a relative free energy of -7.1 kcal/mol for the disorder-to-order transition. A large enthalpic decrease was compensated by a large loss of conformational entropy, despite the small helical increase (no more than three residues) upon phosphorylation. Phosphorylation decreased the conformational dynamics of K and R side chains, especially R16, which forms a salt bridge with pS19. Mutation of R16 to A or E prevented this phosphorylation-dependent ordering. We propose that phosphorylation balances the enthalpy-entropy compensation of the disorder-to-order transition of RLC via short and long-range electrostatic interactions with positively charged residues of the phosphorylation domain. We suggest that this balance is necessary to induce a disorder-to-order conformational change through a subtle energy switching.