Protein kinase B lies "downstream" of phosphatidylinositide (PtdIns) 3-kinase and is thought to mediate many of the intracellular actions of insulin and other growth factors. Here we show that FKHR, a human homologue of the DAF16 transcription factor in Caenorhabditis elegans, is rapidly phosphorylated by human protein kinase Balpha (PKBalpha) at Thr-24, Ser-256, and Ser-319 in vitro and at a much faster rate than BAD, which is thought to be a physiological substrate for PKB. The same three sites, which all lie in the canonical PKB consensus sequences (Arg-Xaa-Arg-Xaa-Xaa-(Ser/Thr)), became phosphorylated when FKHR was cotransfected with either PKB or PDK1 (an upstream activator of PKB). All three residues became phosphorylated when 293 cells were stimulated with insulin-like growth factor 1 (IGF-1). The IGF-1-induced phosphorylation was abolished by the PtdIns 3-kinase inhibitor wortmannin but not by PD 98059 (an inhibitor of the mitogen-activated protein kinase cascade) or by rapamycin. These results indicate that FKHR is a physiological substrate of PKB and that it may mediate some of the physiological effects of PKB on gene expression. DAF16 is known to be a component of a signaling pathway that has been partially dissected genetically and includes homologues of the insulin/IGF-1 receptor, PtdIns 3-kinase and PKB. The conservation of Thr-24, Ser-256, and Ser-319 and the sequences surrounding them in DAF16 therefore suggests that DAF16 is also a direct substrate for PKB in C. elegans.