Small tumor vessels are composed of endothelial cells (ECs) surrounded by pericytes. Pericytes are believed to be an EC survival factor, but their mechanism of action is unknown. One possible mediator, VEGF, promotes angiogenesis, EC proliferation, and EC permeability, and it protects ECs from apoptosis. We hypothesized that PDGF (platelet‐derived growth factor)‐BB, a cytokine released from tumor and ECs, mediates pericyte function by inducing VEGF, which in turn may affect EC survival. Using two pericyte‐like cell lines, 10T1/2 cells (murine pericyte cell line) and human vascular smooth muscle cells (hVSMCs), we showed that PDGF‐BB increased VEGF mRNA transcription. Although PDGF‐BB activated both the mitogen‐activated protein kinase and phosphatidylinositol 3‐kinase (PI3‐K) pathways, activation of the PI3‐K pathway was the most important pathway for VEGF induction. Conditioned medium derived from colon cancer cells also induced VEGF in pericyte‐like cells via the PI3‐K pathway, which was blocked by SU6668, a tyrosine kinase inhibitor that blocks the receptors for PDGF, VEGF, and basic fibroblast growth factor. Conditioned medium from hVSMCs pretreated with PDGF‐BB prevented apoptosis of ECs, and this effect was partially abrogated by neutralizing antibodies to VEGF. These studies suggest that pericytes may protect ECs from apoptosis, in part, by cytokine signaling that increases VEGF.