Vascular endothelial growth factor (VEGF) has been implicated in the regulation of vesicular transport of amniotic fluid via caveolae across the amnion. This study tested the hypothesis that VEGF regulates caveolar function by stimulating caveolin-1 expression and phosphorylation in ovine amniotic epithelial cells (oAECs). Using primary cultures of oAECs, caveolin-1 was identified by immunofluorescent staining. Caveolin-1 messenger RNA (mRNA) abundance was determined by Reverse Transcription-Polymerase Chain Reaction (RT-PCR) and protein by Western blotting. The effects of VEGF( 165) on caveolin-1 expression and phosphorylation were determined. Caveolin-1 immunoreactivity was detected in oAECs. In response to 10 ng/mL VEGF( 165), caveolin-1 mRNA levels increased whereas the protein levels were unaffected. Furthermore, VEGF stimulated caveolin-1 phosphorylation, an effect abrogated by the inhibition of c-Src protein kinase. These data suggest that VEGF upregulates caveolin-1 activity through c-Src signaling pathways. Our observations support the hypothesis that VEGF regulates amniotic fluid transport across the amnion by stimulating caveolin-1 activity to mediate caveolar function in amnion cells.