Phosphorylation of alpha-tocopherol produces an entity with enhanced antiatherogenic properties. Troglitazone, an alpha-tocopherol derivative of a 2,4-thiazolidinedione nucleus, is an antidiabetic agent that shows fatal idiosyncratic hepatotoxicity, a property not shared by later agents. We investigated the effects of phosphorylation of troglitazone (to yield "phosphoglitazone") on the biochemical pharmacologic properties of troglitazone. We investigated its ability to act as a PPARgamma agonist and to inhibit 2 atherogenic properties of vascular smooth muscle cells (vSMC)-proliferation and proteoglycan synthesis. PPARgamma activity was assessed in a transfection assay. Proliferation was assessed by [H]-thymidine incorporation and cell counting and proteoglycan synthesis by [S]-sulfate incorporation using human vSMCs stimulated with platelet-derived growth factor (PDGF; 50 ng/mL) and transforming growth factor (TGF)-beta (2 ng/mL). Phosphoglitazone was a full agonist for PPARgamma with a potency and efficacy similar to troglitazone. Phosphoglitazone also inhibited cell proliferation and proteoglycan synthesis with potency similar to troglitazone. We conclude that phosphorylation retains the pharmacologic activity of troglitazone while decreasing its lipophilicity and therefore potentially its toxicity. A phosphorylated derivative of a 2,4-thiazolidinedione warrants further investigation as a potential new therapeutic agent for the treatment of insulin resistance and Type 2 diabetes.