The phenotypic modulation of vascular smooth muscle cells (VSMCs) plays a pivotal role in hypertension-induced vascular changes including vascular remodeling. The precise mechanisms underlying VSMC phenotypic modulation remain elusive. Here we test the role of peroxisome proliferator-activated receptor (PPAR)-gamma in the VSMC phenotypic modulation during hypertension. Both spontaneously hypertensive rat (SHR) aortas and SHR-derived VSMCs exhibited reduced PPAR-gamma expression and excessive VSMC phenotypic modulation identified by reduced contractile proteins, alpha-smooth muscle actin (alpha-SMA) and smooth muscle 22alpha (SM22alpha), and enhanced proliferation and migration. PPAR-gamma overexpression rescued the expression of alpha-SMA and SM22alpha, and inhibited the proliferation and migration in SHR-derived VSMCs. In contrast, PPAR-gamma silencing exerted the opposite effect. Activating PPAR-gamma using rosiglitazone in vivo up-regulated aortic alpha-SMA and SM22alpha expression and attenuated aortic remodeling in SHRs. Increased activation of phosphoinositide 3-kinase (PI3K)/protein kinase B (AKT) signaling was observed in SHR-derived VSMCs. PI3K inhibitor LY294002 rescued the impaired expression of contractile proteins, and inhibited proliferation and migration in VSMCs from SHRs, whereas constitutively active PI3K mutant had the opposite effect. Overexpression or silencing of PPAR-gamma inhibited or excited PI3K/Akt activity, respectively. LY294002 counteracted the PPAR-gamma silencing induced proliferation and migration in SHR-derived VSMCs, whereas active PI3K mutant had the opposite effect. In contrast, reduced proliferation and migration by PPAR-gamma overexpression were reversed by the active PI3K mutant, and further inhibited by LY294002. We conclude that PPAR-gamma inhibits VSMC phenotypic modulation through inhibiting PI3K/Akt signaling. Impaired PPAR-gamma expression is responsible for VSMC phenotypic modulation during hypertension. These findings highlight an attractive therapeutic target for hypertension-related vascular disorders.