To gain insight into the mechanism by which the adapter protein SH2-B promotes nerve growth factor (NGF)-mediated neuronal differentiation and survival, the effect of SH2-B on the serine/threonine kinase Akt/protein kinase B and downstream effector proteins was examined. PC12 cells stably overexpressing SH2-Bbeta, which exhibit enhanced NGF-induced neuronal differentiation compared with control cells, showed enhanced and prolonged NGF-induced phosphorylation of Akt on Ser473 and Akt enzymatic activity. Surprisingly, NGF-induced phosphorylation of Akt on Ser473 and Akt activity were not altered in cells overexpressing SH2-Bbeta(R555E) with a defective SH2 domain, despite the ability of the overexpressed SH2-Bbeta(R555E) to block NGF-induced differentiation. Consistent with SH2-Bbeta enhancing the activity of Akt, cells overexpressing SH2-Bbeta but not SH2-Bbeta(R555E) exhibited increased and/or prolonged phosphorylation of the pro-apoptotic Akt effector proteins, glycogen synthase kinase-3, and forkhead transcription factors, FKHRL1/FOXO3 and FKHR/FOXO1. Immunolocalization studies indicated that, although ectopically expressed FKHR was primarily concentrated in the cytoplasm of control cells and cells transiently overexpressing SH2-Bbeta, it was concentrated in the nucleus of cells transiently overexpressing SH2-Bbeta(R555E). Similarly, SH2-Bbeta stimulated the accumulation of FKHR in the cytoplasm of 293T and COS-7 cells, whereas SH2-Bbeta(R555E) enhanced its accumulation in the nucleus. In PC12 cells stably expressing forms of SH2-Bbeta, SH2-Bbeta mimicked the ability of NGF to promote redistribution of FKHR to the cytoplasm whereas SH2-Bbeta(R555E) blocked this effect of NGF. Taken together, these data indicate that SH2-B is a positive regulator of NGF-mediated activation of the Akt/Forkhead pathway.