PTEN, encoding a lipid phosphatase, is a tumor suppressor gene and is mutated in various types of cancers. It is reported to regulate G1 to S phase transition of the cell cycle by influencing the expression, protein stability and subcellular location of cyclin D1. Here, we provide evidence that PTEN modulates the transcription and protein stability of cyclin D2. Targeted deletion of Pten in mouse embryonic fibroblasts (MEFs) endowed cells with greater potential to overcome G1 arrest than wild-type MEFs and led to the elevated expression of cyclin D2, which was suppressed by the introduction of PTEN. We further defined a pathway involving GSK3b and b-catenin/TCF in PTEN-mediated suppression of cyclin D2 transcription. LiCl, an inhibitor of GSK3b, abolished inhibitory effect of PTEN on cyclin D2 expression, and TCF members could directly bind to the promoter of cyclin D2 and regulate its transcription in a CREB-dependent manner. Our results indicate that the downregulation of cyclin D2 expression by PTEN is mediated by the GSK3b/b-catenin/TCF pathway in cooperation with CREB, and suggest a convergence from the PI-3 kinase/PTEN pathway and the Wnt pathway in modulation of cyclin D2 expression.