Understanding the regulation of Akt has been of major interest for elucidating the control of normal cellular physiology as well as malignant transformation. The paradigm for activation of Akt involves phosphatidylinositol 3-kinase-dependent membrane localization followed by activating phosphorylation of Thr-308 and Ser-473. Many of the activating signals for Akt involve the stimulation of receptor and non-receptor tyrosine kinases, and the most potent activator known is the tyrosine phosphatase inhibitor pervanadate, highlighting a possible role for tyrosine phosphorylation in the regulation of the enzyme. In this study we show that activation of Akt by pervanadate or serum is associated with tyrosine phosphorylation of Akt. In addition, in SKOV3 ovarian carcinoma cells that exhibit high basal levels of Akt activity, Akt was tyrosine-phosphorylated in the basal state, and this phosphorylation was further enhanced by both pervanadate and insulin-like growth factor-1. We have used NH(2)-terminal sequencing and phosphate release analysis to directly identify Tyr-474 as the site of tyrosine phosphorylation. Substitution of Tyr-474 with phenylalanine abolished tyrosine phosphorylation of Akt and resulted in up to 55% inhibition of Akt activation, indicating phosphorylation at Tyr-474 is required for full activation of the kinase. Our data identifies a novel regulatory mechanism for this pleiotropic enzyme that may be applicable to the AGC family of protein kinases given the conserved nature of the COOH-terminal hydrophobic motif containing Tyr-474.