Pentoxifylline (PTX) is a potent inhibitor of mesangial cell proliferation, but its underlying mechanism is poorly understood. Here, we demonstrate that in platelet-derived growth factor (PDGF)-stimulated mesangial cells, PTX causes G1 arrest by down-regulation of cyclin D1 expression, which subsequently attenuates Cdk4 activity. In vivo, PTX similarly reduces cyclin D1 expression in mesangial cells of rats with acute Thy1 glomerulonephritis. The mechanism by which PTX reduces cyclin D1 is also investigated. PTX blocks Akt but not phosphatidylinositol 3-kinase (PI3K) activation in response to PDGF and abrogates cyclin D1 induction by PI3K, suggesting an effect of PTX on Akt itself. Indeed, PTX is capable of blocking the membrane translocation of Akt, and enforced targeting of Akt to cell membrane prevents the inhibition of Akt and cyclin D1 by PTX. Because PTX is known to increase intracellular cAMP levels by inhibiting phosphodiesterase, the role of protein kinase A (PKA) in these events is investigated. The PKA antagonist N-[2-(4-bromocinnamylamino)ethyl]-5-isoquinoline (H89) abolishes cell proliferation effects of PTX and restores cyclin D1 expression as well as Akt membrane translocation and activation by PDGF, whereas dibutyryl cAMP and forskolin recapitulate the functions of PTX in mesangial cells. In conclusion, our results indicate that PTX, acting through PKA, interferes with PDGF signaling to Akt activation by blocking Akt membrane translocation, thereby inhibiting cyclin D1 expression and mesangial cell proliferation.