Sp1 is a ubiquitous transcription factor and master regulator of various eukaryotic gene expression. Better understanding of the role of increased Sp1 levels on angiogenic regulation and the regulatory regions of that transcription factor may act as a useful target in 'transcriptional therapy'. At the molecular level, butyrate inhibits Sp1-DNA binding activity by promoting Sp1 protein dephosphorylation in EAT cells. It also inhibits Sp1 binding activity and reduces expression of VEGF gene, thereby inhibiting angiogenesis. It was confirmed that butyrate induces expression of a tyrosine phosphatase by RT-PCR, cDNA sequence analysis, protein ESI-MS analysis and protein sequence homology comparison. Thus our result strongly suggests that inhibition of angiogenesis by butyrate involves Sp1 dephosphorylation and down-regulation of VEGF gene expression. Further, butyrate inhibits neoangiogenesis induced by tumor cells and VEGF in peritoneum of EAT bearing mice and rat cornea.