In the nematode Caenorhabditis elegans, mutations of the insulin/insulin-like growth factor-1 receptor homologue Daf-2 gene cause developmental arrest at the dauer stage. The effect of Daf-2 mutations is counteracted by mutations in the Daf-16 gene, suggesting that Daf-16 is required for signaling by Daf-2. Daf-16 encodes a forkhead transcription factor. Based on sequence similarity, the FKHR genes are the likeliest mammalian Daf-16 homologues. FKHR proteins contain potential sites for phosphorylation by the serine/threonine kinase Akt. Because Akt is phosphorylated in response to insulin and has been implicated in a variety of insulin effects, we investigated whether insulin affects phosphorylation of FKHR. Insulin stimulated phosphorylation of endogenous FKHR and of a recombinant c-Myc/FKHR fusion protein transiently expressed in murine SV40-transformed hepatocytes. The effect of insulin was inhibited by wortmannin treatment, suggesting that PI 3-kinase activity is required for FKHR phosphorylation. Mutation of serine 253, located in a consensus Akt phosphorylation site at the carboxyl-terminal end of the forkhead domain, abolished the effect of insulin on FKHR phosphorylation. In contrast, mutation of two additional Akt phosphorylation sites, at amino acids threonine 24 or serine 316, did not abolish insulin-induced phosphorylation. These data indicate that FKHR may represent a distal effector of insulin action.