Angiotensin (A) II plays a critical role in vascular remodeling, and its action is mediated by type 1 AII receptor (AT1R). Recently, 15-deoxy-Δ12,14-prostaglandin J2 and thiazolidinediones have been shown to be ligands for peroxisome proliferator-activated receptor (PPAR)-γ and activate PPAR-γ. In the present work, we have studied the effect of PPAR-γ on AT1R expression in rat vascular smooth muscle cells (VSMCs). We observed that: 1) endogenous AT1R expression was significantly decreased by PPAR-γ ligands both at messenger RNA and protein levels, whereas AT1R messenger RNA stability was not affected; 2) AII-induced increase of 3H-thymidine incorporation into VSMCs was inhibited by PPAR-γ ligands; 3) rat AT1R gene promoter activity was significantly suppressed by PPAR-γ ligands, and PPAR-γ overexpression further suppressed the promoter activity; 4) transcriptional analyses using AT1R gene promoter mutants revealed that a GC-box-related sequence within the -58/-34 region of the AT1R gene promoter was responsible for the suppression; 5) Sp1 overexpression stimulated AT1R gene transcription via the GC-box-related sequence, which was inhibited by additional PPAR-γ overexpression; 6) electrophoretic mobility shift assay suggested that Sp1 could bind to the GC-box-related sequence whereas PPAR-γ could not; 7) antibody supershift experiments using VSMC nuclear extracts revealed that protein-DNA complexes formed on the GC-box-related sequence, which were decreased by PPAR-γ coincubation, were mostly composed of Sp1; and 8) glutathione S-transferase pull-down assay revealed a direct interaction between PPAR-γ and Sp1. Taken together, it is suggested that activated PPAR-γ suppresses AT1R gene at a transcriptional level by inhibiting Sp1 via a protein-protein interaction. PPAR-γ ligands, thus, may inhibit AII-induced cell growth and hypertrophy in VSMCs by AT1R expression suppression and possibly be beneficial for treatment of diabetic patients with hypertension and atherosclerosis.