The regulatory function of caveolin-2 in cell cycle regulation by insulin was investigated in human insulin receptor-overexpressed rat 1 fibroblast (Hirc-B) cells. Insulin increased induction of the caveolin-2 gene in a time-dependent manner. Direct interaction between ERK and caveolin-2 was confirmed by immunoprecipitation and phosphorylated ERK increased the specific interaction in response to insulin. That insulin induced their nuclear co-localization over time was demonstrated by immunofluorescence microscopy. Insulin increased the S phase in the cell cycle by 6-fold. When recombinant caveolin-1 was transiently expressed, a decrease in the S phase was detected by flow-cytometry. The results indicate that the up-regulation of caveolin-2 in response to insulin activates the downstream signal cascades in the cell cycle, chiefly the increased phosphorylation of ERK, the nuclear translocation of phosphorylated ERK, and the subsequent activation of G0/G1 to S phase transition of the cell cycle. The results also suggest that DNA synthesis and the activation of the cell cycle by insulin are achieved concomitantly with an increase in the interaction between caveolin-2 and phosphorylated ERK, and the nuclear translocation of that complex. Taken together, we conclude that caveolin-2 positively regulates the insulin-induced cell cycle through activation of and direct interaction with ERK in Hirc-B cells.