The mammalian cell cycle is regulated by the cyclin/cyclin-dependent kinase (CDK) phosphorylation of the retinoblastoma (pRB) family of proteins. Cyclin D1 with its CDK4/6 partners initiates the cell cycle and acts as the link between extracellular signals and the cell cycle machinery. Estradiol-17beta (E2) stimulates uterine epithelial cell proliferation, a process that is completely inhibited by pretreatment with progesterone (P4). Previously, we identified cyclin D1 localization as a key point of regulation in these cells with E2 causing its nuclear accumulation and P4 retaining it in the cytoplasm with the resultant inhibition of pRB phosphorylation. Here we show that E2 stimulates phosphoinositide 3-kinase to activate phosphokinase B/AKT to effect an inhibitory phosphorylation of glycogen synthase kinase (GSK-3beta). This pathway is suppressed by P4. Inhibition of the GSK-3beta activity in P4-treated uteri by the specific inhibitor, LiCl, reversed the nuclear accumulation of cyclin D1 and in doing so, caused pRB phosphorylation and the induction of downstream genes, proliferating cell nuclear antigen and Ki67. Conversely, inhibition of phosphoinositide 3 kinase by LY294002 or Wortmanin reversed the E2-induced GSK-3beta Ser9 inhibitory phosphorylation and blocked nuclear accumulation of cyclin D1. These data show the reciprocal actions of E2 and P4 on the phosphoinositide 3-kinase through to the GSK-3beta pathway that in turn regulates cyclin D1 localization and cell cycle progression. These data reveal a novel signaling pathway that links E2 and P4 action to growth factor-mediated signaling in the uterus.