The excessive proliferation and migration of vascular smooth muscle cells (SMCs) participate in the growth and instability of atherosclerotic plaque. We examined the direct role of a newly developed chemical inhibitor of cholesteryl ester transfer protein, JTT-705, on SMC proliferation and angiogenesis in endothelial cells (ECs). JTT-705 inhibited human coronary artery SMC proliferation. JTT-705 induced the phosphorylation of p38 mitogen-activated protein kinase (MAPK) and extracellular-signal-regulated kinases (ERK) in SMCs. In addition, the anti-proliferative effects of JTT-705 in SMCs were blocked by p38 MAPK inhibitor. JTT-705 induced the upregulation of p-p21(waf1), and this effect was blocked by dominant-negative Ras (N17), but not by inhibitors of p38 MAPK or ERK. In addition, JTT-705 also induced the upregulation of p27(kip1), and this effect was blocked by p38 MAPK inhibitor. Interestingly, culture medium from JTT-705-treated SMCs blocked human coronary artery EC tube formation in an in vitro model of angiogenesis indirectly via a decrease in vascular endothelial growth factor (VEGF) from SMCs and directly via an anti-proliferative effect in ECs. JTT-705 blocked the proliferation of SMCs through the activation of p38 kinase/p27(kip1) and Ras/p21(waf1) pathways, and simultaneously blocked EC tube formation associated with a decrease in VEGF production from SMCs and an anti-proliferative effect in ECs. Our results indicate that JTT-705 may induce a direct anti-atherogenic effect in addition to its inhibitory effect of CETP activity.