Activating mutations in NOTCH1 are the most prominent genetic abnormality in T-cell acute Lymphoblastic Leukemia (T-ALL) and inhibition of NOTCH1 signaling with gamma-secretase inhibitors (GSIs) has been proposed as targeted therapy in this disease. However, most T-ALL cell lines with mutations in NOTCH1 fail to respond to GSI therapy. Using gene expression profiling and mutation analysis we showed that mutational loss of PTEN is a common event in T-ALL and is associated with resistance to NOTCH inhibition. Furthermore, our studies revealed that NOTCH1 induces upregulation of the PI3K-AKT pathway via HES1, which negatively controls the expression of PTEN. This regulatory circuitry is evolutionary conserved from Drosophila to humans as demonstrated by the interaction of overexpression of Delta and Akt in a model of Notch-induced transformation in the fly eye. Loss of PTEN and constitutive activation of AKT in T-ALL induce increased glucose metabolism and bypass the requirement of NOTCH1 signaling to sustain cell growth. Importantly, PTEN-null/GSI resistant T-ALL cells switch their oncogene addiction from NOTCH1 to AKT and are highly sensitive to AKT inhibitors. These results should facilitate the development of molecular therapies targeting NOTCH1 and AKT for the treatment of T-ALL.