A forkhead transcription factor gene, fktf-1, which we propose to be orthologous to the Caenorhabditis elegans dauer-regulatory gene daf-16 has been discovered in the parasitic nematode Strongyloides stercoralis. Genomic and cDNA sequences from both species predict alternately spliced a and b message isoforms. In contrast to C. elegans, where two a isoforms, daf-16a1 and daf-16a2, are found, a single fktf-1a isoform is found in S. stercoralis. Five of the 10 introns found in the C. elegans gene are found in the proposed S. stercoralis ortholog. Functional motifs common to DAF-16 and several mammalian forkhead transcription factors are conserved in FKTF-1. These include the forkhead DNA binding domain, four Akt/protein kinase B phosphorylation sites and a C-terminal domain that may associate with factors such as the steroid receptor coactivator and other factors necessary for transcriptional regulation. An N-terminal serine-rich domain found in DAF-16A is greatly expanded in FKTF-1A. This domain is missing in DAF-16B, FKTF-1B and all mammalian orthologs. FKTF-1 shows the closest phylogenetic relationship to DAF-16 among all known mammalian and nematode forkhead transcription factors. Like its proposed Caenorhabditis ortholog, the fktf-1 message is expressed at all stages of the life cycle examined thus far. Discovery of fktf-1 indicates the presence of an insulin-like signalling pathway in S. stercoralis similar to that known to regulate dauer development in C. elegans. This pathway is a likely candidate to control infective larval arrest and reactivation as well as regulation of the switch between parasitic and free-living development in the parasite.