Insulin-like growth factors promote myoblast differentiation through phosphoinositol 3-kinase and Akt signaling. Akt substrates required for myogenic differentiation are unknown. Forkhead transcription factors of the forkhead box gene, group O (Foxo) subfamily are phosphorylated in an insulin-responsive manner by phosphatidylinositol 3-kinase–dependent kinases. Phosphorylation leads to nuclear exclusion and inactivation. We show that a constitutively active Foxo1 mutant inhibits differentiation of C₂C₁₂ cells and prevents myotube differentiation induced by constitutively active Akt. In contrast, a transcriptionally inactive mutant Foxo1 partially rescues inhibition of C₂C₁₂ differentiation mediated by wortmannin, but not by rapamycin, and is able to induce aggregation-independent myogenic conversion of teratocarcinoma cells. Inhibition of Foxo expression by siRNA resulted in more efficient differentiation, associated with increased myosin expression. These observations indicate that Foxo proteins are key effectors of Akt-dependent myogenesis.