The proteoglycan versican is pro-atherogenic and central to vascular injury and repair events. We identified the signaling pathways and promoter elements involved in regulation of versican expression in vascular smooth muscle cells. Phosphatidylinositol 3-kinase inhibitor, LY294002, significantly decreased versican-luciferase (Luc) promoter activity and endogenous mRNA levels. We further examined the roles of protein kinase B and glycogen synthase kinase (GSK)-3beta, downstream effectors of phosphatidylinositol 3-kinase, in the regulation of versican transcription. Co-transfection of dominant negative and constitutively active protein kinase B constructs with a versican-Luc construct decreased and increased promoter activity, respectively. Inhibition of GSK-3beta activity by LiCl augmented accumulation of beta-catenin and caused induction of versican-Luc activity as well as versican mRNA levels. Beta-catenin has no DNA binding domain, therefore it cannot directly induce transcription of the versican promoter. Software analysis of the versican promoter revealed two potential binding sites for T-cell factors (TCFs), proteins that confer transcriptional activation of beta-catenin. Electrophoretic mobility shift and supershift assays revealed specific binding of human TCF-4 and beta-catenin to oligonucleotides corresponding to a potential TCF binding site in the versican promoter. In addition to binding assays, we directly assessed the dependence of versican promoter activity on TCF binding sites. Site-directed mutagenesis of the TCF site located -492 bp relative to the transcription start site markedly diminished versican-Luc activity. Co-transfection of TCF-4 with versican-Luc did not increase promoter activity, but addition of beta-catenin and TCF-4 significantly stimulated basal versican promoter activity. Our findings suggest that versican transcription is predominantly mediated by the GSK-3beta pathway via the beta-catenin-TCF transcription factor complex in smooth muscle cells, wherein such regulation contributes to the normal or aberrant formation of provisional matrix in vascular injury and repair events.