The Y box-binding protein 1 (YB-1) is a DNA/RNA-binding protein that regulates mRNA transcription and translation. It is a major component of free messenger ribonucleoprotein particles and, at higher concentrations, blocks protein synthesis. In chicken embryo fibroblasts, overexpression of YB-1 confers a specific resistance to oncogenic cellular transformation by phosphoinositide 3-kinase (PI3K) or Akt/PKB. Recent studies have identified YB-1 as a direct substrate of Akt. The functional significance of Akt-mediated phosphorylation remains largely unknown. We generated YB-1 mutants in the Akt phosphorylation consensus sequence to explore the effect of phosphorylated YB-1 in PI3K-induced transformation. In contrast to wild-type YB-1, the phosphomimetic S99E mutant no longer interferes with cellular transformation. This mutant has reduced affinity for the cap of mRNAs and fails to inhibit cap-dependent translation. The data suggest that phosphorylation by Akt disables the inhibitory activity of YB-1 and thereby enhances the translation of transcripts that are necessary for oncogenesis. Overexpression of wild-type YB-1 overrides inactivation by Akt and maintains inhibition of protein synthesis and resistance to transformation.