Background: Angiotensin II (ANG II) inhibits proliferation and induces differentiation in PC 12 cells via AT<sub>2</sub> receptor activation. Using differential display analysis, we previously isolated SM-20/PHD3 as a key factor, which is downregulated by ANG II treatment. Subsequently, it turned out that SM-20/PHD3 is a rat homologue of PHD3, a key prolyl hydroxylase involved in the initial steps fostering the degradation of hypoxia-inducible factor (HIF). The present study was undertaken to investigate whether the ANG-II-mediated suppression of SM-20/PHD3/PHD3 may be associated with an increase in HIF-1α. Methods: HIF-1α protein expression was assessed by Western blots. mRNA levels for HIF-1α were measured by real-time PCR and for SM-20/PHD3 by Northern blots. Binding of HIF-1α to consensus oligonucleotides in vitro was determined with gel shift analysis. SM-20/PHD3 was transiently overexpressed in PC 12 cells using an inducible expression system. Results: ANG II stimulated HIF-1α protein expression. This effect was already detected after 30 min and peaked at 6 h, but was not detectable anymore after 24– 48 h of stimulation. PD 123177, but not losartan, antagonized this effect, indicating transduction through AT<sub>2</sub> receptors. Real-time PCR failed to show a significant increase in HIF-1α transcripts after ANG II challenge at any time point. Gel shift analysis revealed that ANG-II-induced nuclear HIF-1α protein binds to consensus sites. A reduction in SM-20/PHD3 mRNA expression paralleled the increase in HIF-1α. Overexpression of SM-20/PHD3 transiently resulted in a decrease in HIF-1α protein concentrations under basal conditions as well as after stimulation with ANG II. Conclusion: ANG II stimulates HIF-1α expression by a posttranscriptional mechanism via AT<sub>2</sub> receptors. This increase is likely caused by a downregulation of SM-20/PHD3. The ANG-II-mediated increase in HIF-1α expression could be potentially involved in physiological as well as pathophysiological processes such as differentiation, growth inhibition, and remodeling.