Kaposi's sarcoma–associated herpesvirus (KSHV) is linked to three different human cancers: Kaposi's sarcoma, primary effusion lymphoma, and multicentric Castleman's disease. The Kaposi's sarcoma lesion expresses high levels of angiogenic factors and is comprised of a mixed cell population, including endothelial cells that are infected with KSHV. We find that the KSHV K1 protein is expressed in Kaposi's sarcoma lesions and can immortalize and extend the life span of primary human umbilical vein endothelial cells in culture. Vascular endothelial growth factor (VEGF) is critical for the survival of endothelial cells, and we show that expression of K1 in endothelial cells resulted in increased levels of secreted VEGF and the activation of key signaling pathways, including the VEGF/VEGF receptor and the phosphatidylinositol-3′-OH-kinase (PI3K) pathway. The SH2 binding motifs present in the cytoplasmic tail of K1 were critical for K1's ability to activate these pathways. Activation of PI3K by K1 results in activation of Akt kinase and mammalian target of rapamycin and inactivation of the proapoptotic proteins FKHR, glycogen synthase kinase-3, and Bad, which are events indicative of cell survival. Because activation of the PI3K pathway is critical for transformation of many human cells, we suggest that PI3K activation by K1 is involved in endothelial cell immortalization and contributes to KSHV-associated tumorigenesis. We also report that K1 enhances angiogenesis in vivo and increases tumor vasculature and tumor size. (Cancer Res 2006; 66(7): 3658-66)