Phosphorylated tyrosine residues of growth factor receptors that associate with intracellular proteins containing src-homology 2 (SH2) domains are integral components in several signal transduction pathways related to proliferative diseases such as cancer, atherosclerosis, and restenosis. In particular, a phosphorylated pentapeptide [pTyr751-Val-Pro-Met754-Leu (pTyr = phosphotyrosine)] derived from the primary sequence of platelet-derived growth factor-beta (PDGF-beta) receptor blocks the association of the C-terminal SH2 domain of the p85 subunit of phosphatidylinositol 3-kinase (PI 3-kinase) to PDGF-beta receptor with an IC50 of 0.445 +/- 0.047 microM. Further evaluation of the structure-activity relationships for pTyr751-Val-Pro-Met-Leu resulted in the design of smaller peptidomimetics with enhanced affinity including Ac-pTyr-Val-Ala-N(C6H13)2 (IC50 = 0.076 +/- 0.010 microM). In addition, the phosphotyrosine residue was replaced with a difluorophosphonate derivative [4-phosphono(difluoromethyl)phenylalanine (CF2Pmp)] which has been shown to be stable to cellular phosphatases. The extracellular administration of either CF2Pmp-Val-Pro-Met-Leu or Ac-CF2Pmp-Val-Pro-Met-NH2 in a whole cell assay resulted in specific inhibition of the PDGF-stimulated association from the C-terminal SH2 domain of the p85 subunit of PI 3-kinase to the PDGF-beta receptor in a dose-dependent manner. These compounds were also effective in inhibiting GLUT4 translocation, c-fos expression, and cell membrane ruffling in single-cell microinjection assay.