The cellular pathways involved in the impairment of insulin signaling by cellular stress, triggered by the inflammatory cytokine tumor necrosis factor-α (TNF) or by translational inhibitors like cycloheximide and anisomycin were studied. Similar to TNF, cycloheximide and anisomycin stimulated serine phosphorylation of IRS-1 and IRS-2, reduced their ability to interact with the insulin receptor, inhibited the insulin-induced tyrosine phosphorylation of IRS proteins, and diminished their association with phosphatidylinositol 3-kinase (PI3K). These defects were partially reversed by wortmannin and LY294002, indicating that a PI3K-regulated step is critical for the impairment of insulin signaling by cellular stress. Induction of cellular stress resulted in complex formation between PI3K and ErbB2/ErbB3 and enhanced PI3K activity, implicating ErbB proteins as downstream effectors of stress-induced insulin resistance. Indeed, stimulation of ErbB2/ErbB3 by NDFβ1, the ErbB3 ligand, inhibited IRS protein tyrosine phosphorylation and recruitment of downstream effectors. Specific inhibitors of the ErbB2 tyrosine kinase abrogated the activation of ErbB2/ErbB3 and in parallel prevented the reduction in IRS protein functions. Taken together, our results suggest a novel mechanism by which cellular stress induces cross-talk between two different signaling pathways. Stress-dependent transactivation of ErbB2/ErbB3 receptors triggers a PI3K cascade that induces serine phosphorylation of IRS proteins culminating in insulin resistance.