We report here the identification of angiopoietin-related growth factor (AGF) as a positive mediator for angiogenesis. To investigate the biologic function of AGF in angiogenesis, we analyzed the vasculature in the dermis of transgenic mice expressing AGF in mouse epidermal keratinocytes (K14-AGF). K14-AGF transgenic mice were grossly red, especially in the ears and snout, suggesting that hypervascularization had occurred in their skin. Histologic examination of ear skin from K14-AGF transgenic mice revealed increased numbers of microvessels in the dermis, whereas the expression of several angiogenic factors, such as basic fibroblast growth factor (bFGF), vascular endothelial growth factors (VEGFs), and angiopoietin-1 (Ang-1), was decreased. We showed that AGF is a secreted protein and does not bind to tyrosine kinase with immunoglobulin and EGF-homology domain (Tie1) or Tie2 receptors. An in vitro chamber assay revealed that AGF directly promotes chemotactic activity of vascular endothelial cells. Both mouse corneal and matrigel plug assays showed that AGF induces neovascularization in vivo. Furthermore, we found that plasma leakage occurred after direct injection of AGF into the mouse dermis, suggesting that AGF directly induces a permeability change in the local vasculature. On the basis of these observations, we propose that AGF is a novel angiogenic factor and that handling of its biologic functions could lead to novel therapeutic strategies for control of angiogenesis.