Aberrant activation of Akt plays a pivotal role in cancer development. ATM, a protein deficient in patients with ataxia-telangiectasia disease, is traditionally considered as a nuclear protein kinase that functions as a signal transducer in response to DNA damage. It has recently been shown that ATM is also a cytoplasmic protein that mediates the full activation of Akt in response to insulin. Our study shows that a specific ATM inhibitor, KU-55933, blocks the phosphorylation of Akt induced by insulin and insulin-like growth factor I in cancer cells that exhibit abnormal Akt activity. Moreover, KU-55933 inhibits cancer cell proliferation by inducing G1 cell cycle arrest. It does so through the downregulation of the synthesis of cyclin D1, a protein known to be elevated in a variety of tumors. In addition, KU-55933 treatment during serum starvation triggers apoptosis in these cancer cells. Our results suggest that KU-55933 may be a novel chemotherapeutic agent targeting cancer resistant to traditional chemotherapy or immunotherapy due to aberrant activation of Akt. Furthermore, KU-55933 completely abrogates rapamycin-induced feedback activation of Akt. Combination of KU-55933 and rapamycin not only induces apoptosis, which is not seen in cancer cells treated only with rapamycin, but also shows better efficacy in inhibiting cancer cell proliferation than each drug alone. Therefore, combining KU-55933 with rapamycin may provide a highly effective approach for improving mammalian target of rapamycin-targeted anticancer therapy that is currently hindered by rapamycin-induced feedback activation of Akt.