Hyperglycemia and insulin resistance accelerate atherosclerosis by an unclear mechanism. The two factors down-regulate insulin receptor substrate-1 (IRS-1)， an intermediary of the insulin/IGF-I signaling system. We previously reported that IRS-1 down-regulation leads to vascular smooth muscle cell (VSMC) dedifferentiation and that IRS-1 deletion from VSMCs in normoglycemic mice replicates this response. However， we did not determine IRS-1's role in mediating differentiation. Here， we sought to define the mechanism by which IRS-1 maintains VSMC differentiation. High glucose or IRS-1 knockdown decreased p53 levels by enhancing MDM2 proto-oncogene (MDM2)-mediated ubiquitination， resulting in decreased binding of p53 to Krüppel-like factor 4 (KLF4). Exposure to nutlin-3， which dissociates MDM2/p53， decreased p53 ubiquitination and enhanced the p53/KLF4 association and differentiation marker protein expression. IRS-1 overexpression in high glucose inhibited the MDM2/p53 association， leading to increased p53 and p53/KLF4 levels， thereby increasing differentiation. Nutlin-3 treatment of diabetic or mice enhanced p53/KLF4 and the expression of p21， smooth muscle protein 22 (SM22)， and myocardin and inhibited aortic VSMC proliferation. Injecting normoglycemic mice with a peptide disrupting the IRS-1/p53 association reduced p53， p53/KLF4， and differentiation. Analyzing atherosclerotic lesions in hypercholesterolemic， diabetic pigs， we found that p53， IRS-1， SM22， myocardin， and KLF4/p53 levels are significantly decreased compared with their expression in nondiabetic pigs. We conclude that IRS-1 is critical for maintaining VSMC differentiation. Hyperglycemia- or insulin resistance-induced IRS-1 down-regulation decreases the p53/KLF4 association and enhances dedifferentiation and proliferation. Our results suggest that enhancing IRS-1-dependent p53 stabilization could attenuate the progression of atherosclerotic lesions in hyperglycemia and insulin-resistance states.