The tumor suppressor p53 is commonly inhibited under conditions in which the phosphatidylinositide 3'-OH kinase/protein kinase B (PKB)Akt pathway is activated. Intracellular levels of p53 are controlled by the E3 ubiquitin ligase Mdm2. Here we show that PKB inhibits Mdm2 self-ubiquitination via phosphorylation of Mdm2 on Ser(166) and Ser(188). Stimulation of human embryonic kidney 293 cells with insulin-like growth factor-1 increased Mdm2 phosphorylation on Ser(166) and Ser(188) in a phosphatidylinositide 3'-OH kinase-dependent manner, and the treatment of both human embryonic kidney 293 and COS-1 cells with phosphatidylinositide 3'-OH kinase inhibitor LY-294002 led to proteasome-mediated Mdm2 degradation. Introduction of a constitutively active form of PKB together with Mdm2 into cells induced phosphorylation of Mdm2 at Ser(166) and Ser(188) and stabilized Mdm2 protein. Moreover, mouse embryonic fibroblasts lacking PKBalpha displayed reduced Mdm2 protein levels with a concomitant increase of p53 and p21(Cip1), resulting in strongly elevated apoptosis after UV irradiation. In addition, activation of PKB correlated with Mdm2 phosphorylation and stability in a variety of human tumor cells. These findings suggest that PKB plays a critical role in controlling of the Mdm2.p53 signaling pathway by regulating Mdm2 stability.