Diabetes is associated with increased formation of advanced glycation end products (AGEs), which have been implicated in micro and macrovascular complications of diabetes. Our earlier reports showed proangiogenic effect of AGE-bovine serum albumin (BSA). In order to understand the mechanism of AGE-mediated angiogenesis, the possibility of involvement of peroxisome prolifeator activated receptor (PPAR) gamma, a ligand activated transcription factor was examined. The angiogenic effect was studied in chick chorio allantoic membrane (CAM) and by analyzing angiogenic markers in human umbilical vein endothelial cells (HUVECs) in culture. The involvement of PPAR y was investigated using synthetic PPAR gamma agonist GW 1929 and antagonist GW 9662 and by RT-PCR. In CAM assay, PPAR gamma antagonist GW 9662 reversed the AGE-induced effect on vascularity. In HUVECs in culture, GW 9662 reversed the effect of AGE-BSA and decreased the expression of CD 31, E-Selectin and VEGF. RT-PCR analysis showed that treatment with AGE-BSA caused upregulation of PPAR gamma mRNA levels. The reversal of the effect of AGE on angiogenesis by treatment with PPAR gamma antagonists and up-regulation of PPAR gamma gene in HUVECs treated with AGE-BSA suggested the possible involvement of PPAR gamma-dependent downstream pathway in mediating the angiogenic effect of AGE.