AlphaB-crystallin homology, heat stress induction and chaperone activity suggested that a previously encloned gene product is a novel small heat shock protein (Hsp16.2). Suppression of Hsp16.2 by siRNA sensitized cells to hydrogen peroxide or taxol induced cell-death. Over-expressing of Hsp16.2 protected cells against stress stimuli by inhibiting cytochrome c release from the mitochondria, nuclear translocation of AIF and endonuclease G, and caspase 3 activation. Recombinant Hsp16.2 protected mitochondrial membrane potential against calcium induced collapse in vitro indicating that Hsp16.2 stabilizes mitochondrial membrane systems. Hsp16.2 formed self-aggregates and bound to Hsp90. Inhibition of Hsp90 by geldanamycin diminished the cytoprotective effect of Hsp16.2 indicating that this effect was Hsp90-mediated. Hsp16.2 over-expression increased lipid rafts formation as demonstrated by increased cell surface labeling with fluorescent cholera toxin B, and increased Akt phosphorylation. The inhibition of PI-3-kinase-Akt pathway by LY-294002 or wortmannin significantly decreased the protective effect of the Hsp16.2. These data indicate that the over-expression of Hsp16.2 inhibits cell death via the stabilization of mitochondrial membrane system, activation of Hsp90, stabilization of lipid rafts and by the activation of PI-3-kinase-Akt cytoprotective pathway.