Insulin treatment of adipocytes causes the rapid phosphorylation of the insulin receptor substrate-1 (IRS-1) on tyrosine. The phosphotyrosine [Tyr(P)] form of IRS-1 then complexes with the enzyme phosphatidylinositol (PI) 3-kinase. In this study, we have investigated the effect of this association on PI 3-kinase activity in 3T3-L1 adipocytes. Insulin stimulated cytosolic PI 3-kinase activity about sevenfold. This stimulation was maximal after 1 min of exposure of cells to insulin, persisted for at least 1 h, and occurred over the range of insulin concentrations that saturate its receptor. By means of immunoprecipitation of IRS-1, it was shown that virtually all of the enhanced activity was due to PI 3-kinase complexed with IRS-1. Moreover, the purified Tyr(P) form of IRS-1, either isolated from 3T3-L1 adipocytes or obtained by phosphorylation of the recombinant protein with the insulin receptor, markedly stimulated the activity of purified rat liver PI 3-kinase. These results show that the association of Tyr(P) IRS-1 with PI 3-kinase activates the enzyme and thereby can explain the elevation of PI 3,4-bisphosphate and PI 3,4,5-trisphosphate in vivo observed upon treatment of adipocytes with insulin.