Clinical studies indicate that Herceptin (trastuzumab), a recombinant humanized monoclonal antibody directed against the human epidermal growth factor receptor-2 (HER-2) tyrosine kinase growth factor receptor, provides a significant but transient survival advantage to a subset of patients with HER-2-overexpressing metastatic breast cancer when given as a first-line agent. Increased insulin-like growth factor (IGF)-I receptor (IGF-IR) signaling has recently been identified as a potential factor adversely influencing the response to Herceptin. We examined the effect of recombinant human IGF binding protein 3 (rhIGFBP-3), an antagonist of IGF-IR signaling, in Herceptin-resistant breast cells in vitro and in tumors in vivo. Consistent with results obtained using HER-2- or IGF-IR-transfected cells (MCF-7/HER2-18 and SKBR3/IGF-IR, respectively), we found that rhIGFBP-3 significantly reduced IGF-I-induced IGF-IR phosphorylation and displayed a synergistic interaction with Herceptin against cultured HER-2-overexpressing breast cancer cells in vitro. We show, for the first time, the antitumor activity of rhIGFBP-3 against advanced-stage MCF-7/HER2-18-transfected human breast cancer xenografts and its potentiation of Herceptin activity. We also provide evidence that IGF-IR activation counters the early suppressive effect of Herceptin on HER-2 signaling via Akt and p44/p42 mitogen-activated protein kinase (MAPK), and that inhibition of HER-2-overexpressing human breast tumor growth by rhIGFBP-3 is associated with restored down-regulation of Akt and p44/p42 MAPK phosphorylation in vitro and in vivo. These results emphasize the merit of evaluating simultaneous blockade of the HER-2 and IGF-IR pathways using combination therapy with rhIGFBP-3 plus Herceptin in human clinical trials of patients with HER-2-positive breast cancer.