The cytokine IL-2 plays a very important role in the proliferation and survival of activated T cells. These effects of IL-2 are dependent on signaling through the phosphatidylinositol 3-kinase (PI3K) pathway. We and others have shown that PI3K, through activation of protein kinase B/Akt, inhibits transcriptional activation by a number of forkhead transcription factors (FoxO1, FoxO3, and FoxO4). In this study we have investigated the role of these forkhead transcription factors in the IL-2-induced T cell proliferation and survival. We show that IL-2 regulates phosphorylation of FoxO3 in a PI3K-dependent fashion. Phosphorylation and inactivation of FoxO3 appears to play an important role in IL-2-mediated T cell survival, because mere activation of FoxO3 is sufficient to trigger apoptosis in T cells. Indeed, active FoxO3 can induce expression of IL-2-regulated genes, such as the cdk inhibitor p27(Kip1) and the proapoptotic Bcl-2 family member Bim. Furthermore, we show that IL-2 triggers a rapid, PI3K-dependent, phosphorylation of FoxO1a in primary T cells. Thus, we propose that inactivation of FoxO transcription factors by IL-2 plays a critical role in T cell proliferation and survival.