Glioblastoma multiforme (GBM) cells frequently harbor amplification and/or gain-of-function mutation of the EGFR gene leading to the activation of multiple signaling pathways. Blockade of EGFR activation inhibited the activation of both AKT and Stat3 in U87 and D54 GBM cells and induced spontaneous apoptosis, which were associated with reduction in the steady-state level of Mcl-1. Surprisingly, inhibition of PI3 kinase (PI3K) activity, which in turn inhibited AKT activation, significantly increased the DNA-binding activity of Stat3 in U87 and D54 cells. This was not due to an increase in the level of tyrosine-phosphorylated Stat3. Conversely, ectopic expression of constitutively activated AKT significantly decreased the DNA-binding activity of Stat3 in 293T cells. Interestingly, blockade of protein phosphatase 2A activity in GBM or 293T cells by calyculin A, which activated AKT, stabilized the phosphorylation of multiple Ser/Thr residues that were located in the transactivation domain (TAD) of Stat3 and this in turn completely ablated the DNA-binding activity of Stat3. Collectively, these results suggest that both Stat3 and AKT provide survival signals in U87 and D54 cells, and Ser/Thr phosphorylation of Stat3-TAD by the PI3K-AKT pathway negatively controls the DNA-binding function of Stat3.