In the present paper, we have studied the expression of the Phosphatase and TENsin homolog deleted on chromosome 10 (PTEN) and its putative biological role in the sheep ovary. We found by Northern-blot, immunohistochemistry and immunoblot that PTEN is highly expressed in granulosa cells from large differentiated follicles (LF) in comparison with small proliferating follicles (SF) (P < 0.001), with no clear effect of follicle quality. Moreover, the PTEN lipid phosphatase activity is also higher in LF than in SF (P < 0.01). In contrast, levels of the phosphorylated form of AKT (pAKT) are lower in LF than in SF (P < 0.0001). IGF-I and insulin but not FSH, LH or forskolin are able to stimulate the expression of PTEN mRNA (P < 0.001) and protein by ovine granulosa cells after 48 h of culture in vitro. An IGF-1 time course analysis showed that expression of PTEN protein appeared after 12h of culture, concomitant with the fall of the pAKT levels, which peaked after 6h of stimulation with IGF-I. Moreover, transfection experiments showed that overexpression of PTEN in ovine granulosa cells induced a decrease and an increase in E2F and p27 promoter activity, respectively (P < 0.05). Overall, our present data show for the first time that the expression of PTEN increases during terminal follicular growth. This increase, that might be induced by IGF-I but not FSH, would participate in the proliferation/differentiation transition of ovine granulosa cells in differentiating follicles.