Chronic limb ischemia, a complication commonly observed in conjunction with cardiovascular disease, is characterized by insufficient neovascularization despite the up-regulation of pro-angiogenic mediators. One hypothesis is that ischemia induces inhibitory signals that circumvent the normal capillary growth response. FoxO transcription factors exert anti-proliferative and pro-apoptotic effects on many cell types. We studied the regulation of FoxO1 protein in ischemic rat skeletal muscle following iliac artery ligation and in cultured endothelial cells. We found that FoxO1 expression was increased in capillaries within ischemic muscles compared with those from rats that underwent a sham operation. This finding correlated with increased expression of p27 Kip1 and reduced expression of Cyclin D1. Phosphorylated Akt was reduced concurrently with the increase in FoxO1 protein. In skeletal muscle endothelial cells, nutrient stress as well as lack of shear stress stabilized FoxO1 protein, whereas shear stress induced FoxO1 degradation. Endogenous FoxO1 co-precipitated with the E3 ubiquitin ligase murine double minute-2 (Mdm2) in endothelial cells, and this interaction varied in direct relation to the extent of Akt and Mdm2 phosphorylation. Moreover, ischemic muscles had a decreased level of Mdm2 phosphorylation and a reduced interaction between Mdm2 and FoxO1. Our results provide novel evidence that the Akt-Mdm2 pathway acts to regulate endothelial cell FoxO1 expression and illustrate a potential mechanism underlying the pathophysiological up-regulation of FoxO1 under ischemic conditions.