Vanadate and peroxovanadium derivatives are potent inhibitors of protein tyrosine phosphatases (PTPs) and exhibit insulinomimetic activities in several cell systems. We have found that in 293 and 293T cells, intercellular adhesion molecule-1 (ICAM-1) gene transcription is activated by bpV(Pic), a picolinic acid-stabilized peroxovanadium derivative. To identify the bpV(Pic)-responsive element(s), several deletion and site-specific mutants of the ICAM-1 gene promoter cloned upstream from the firefly luciferase reporter gene were transiently transfected into both cell lines. Deletion or site-specific mutation of the NF-kappa B site did not affect bpV(Pic) responsiveness, whereas deletion or mutation of the palindromic interferon-gamma-responsive element (pI gamma RE)/gamma-interferon activated sequence site greatly decreased bpV(Pic) responsiveness in both cell types. bpV(Pic) synergistically co-operated with interferon-gamma to increase the transcriptional activity of the ICAM-1 promoter. Electrophoretic mobility-shift assays showed that bpV(Pic) induces signal transducers and activators of transcription (STAT)-1 binding to the ICAM-1 pI gamma RE/GAS in 293T cells, suggesting that the peroxovanadium compound specifically inhibits the phosphatase(s) required to regulate the JAK/STAT signal-transduction pathway.