Excessive proliferation of vascular smooth muscle cells (VSMCs) and neointimal formation are critical steps in the pathogenesis of atherosclerosis and restenosis after percutaneous transluminal angioplasty. In this study, we investigated the hypothesis that the activator protein-1 (AP-1) plays an important role in neointimal formation after vascular injury. A circular dumbbell AP-1 decoy oligodeoxynucleotide (CDODN) was developed as a novel therapeutic strategy for restenosis after angioplasty. This CDODN was more stable than the conventional phosphorothioate linear decoy ODN (PSODN) and maintained structural integrity on exposure to exonuclease III or serum. Transfection with AP-1 decoy ODNs strongly inhibited VSMC proliferation and migration, as well as glucose- and serum-induced expression of PCNA and cyclin A genes. Administration of AP-1 decoy ODNs in vivo using the hemagglutinating virus of Japan (HVJ)-liposome method virtually abolished neointimal formation after balloon injury to the rat carotid artery. Compared with PSODN, CDODN was more effective in inhibiting the proliferation of VSMCs in vitro and neointimal formation in vivo. Our results collectively indicate that AP-1 activation is crucial for the mediation of VSMC proliferation in response to vascular injury. Moreover, the use of stable CDODN specific for AP-1 activity in combination with the highly effective HVJ-liposome method provides a novel potential therapeutic strategy for the prevention of restenosis after angioplasty in humans.