The effects of the antiangiogenic cytokine PEDF on key steps in retinal angiogenesis, specifically endothelial cell proliferation and vascular tubule formation, and the regulation of PEDF expression in retinal capillary endothelial cells were evaluated. HUVECs were co-cultured with fibroblasts to construct a model of angiogenesis using the Angiokit assay, and image analysis software was used to measure the effects of PEDF and VEGF on vascular tubule formation. Quantitative real-time PCR analysis was used to determine the expression of PEDF in microvascular endothelial cells exposed to glucose 20 mM, insulin 100 nM and VEGF 10 ng/ml. PEDF inhibited endothelial cell proliferation and significantly decreased the number of tubules (629+93 AU vs 311+31, p=0.001), number of branching points (145+19 AU vs 46+5, p=0.03) and total tubule length (4848+748 AU vs 11,172+2353, p=0.001). In bovine retinal capillary endothelial cells (BRCECs), PEDF mRNA and protein expression was suppressed by insulin (22%) in a rapamycin-sensitive manner; wortmannin had no effect. PEDF mRNA expression was also significantly reduced in the presence of high glucose (23%) and VEGF (25%). In conclusion, PEDF inhibits key steps in the angiogenic response of BRCECs, including endothelial cell proliferation and vascular tubule formation. Gene expression of PEDF is negatively regulated by glucose, insulin (via an mTOR-dependent pathway) and VEGF.