Angiogenesis induced by vascular endothelial growth factor (VEGF) plays an important role in psoriasis. Hypoxic adaptation is conferred through hypoxia-inducible transcription factors (HIFs). VEGF and its receptor Flt-1 are HIF target genes. Growth factors and inflammatory cytokines activate the phosphoinositol-3 kinase pathway, and via activated protein kinase B (phospho-Akt) augment HIF activity. Here, we demonstrate that the major oxygen-dependent HIF isoforms are strongly upregulated in psoriatic skin: HIF-1α mainly in the epidermis, in an expression pattern similar to VEGF mRNA; HIF-2α in both the epidermis and in capillary endothelial cells of the dermis. In contrast, normal human skin shows low expression of HIF-α proteins, with the exception of hair follicles, and glands, which strongly express HIF-1α. In normal human skin, phospho-Akt appeared in the basal epidermal layer, in hair follicles, and in dermal glands. In contrast, in psoriasis, phospho-Akt expression was low in the epidermis, but markedly enhanced in the dermal capillaries and in surrounding interstitial/inflammatory cells. Our data suggest that hypoxia initiates a potentially self-perpetuating cycle involving HIF, VEGF, and Akt activation, which could drive physiologic growth of hair follicles and skin glands. Furthermore, such a cycle may exist in psoriasis in dermal capillaries and contribute to disease progression.