Mammalian target of rapamycin (mTOR) is a central regulator of protein synthesis whose activity is modulated by a variety of signals. Energy depletion and hypoxia result in mTOR inhibition. While energy depletion inhibits mTOR through a process involving the activation of AMP-activated protein kinase (AMPK) by LKB1 and subsequent phosphorylation of TSC2, the mechanism of mTOR inhibition by hypoxia is not known. Here we show that mTOR inhibition by hypoxia requires the TSC1/TSC2 tumor suppressor complex and the hypoxia-inducible gene REDD1/RTP801. Disruption of the TSC1/TSC2 complex through loss of TSC1 or TSC2 blocks the effects of hypoxia on mTOR, as measured by changes in the mTOR targets S6K and 4E-BP1, and results in abnormal accumulation of Hypoxia-inducible factor (HIF). In contrast to energy depletion, mTOR inhibition by hypoxia does not require AMPK or LKB1. Down-regulation of mTOR activity by hypoxia requires de novo mRNA synthesis and correlates with increased expression of the hypoxia-inducible REDD1 gene. Disruption of REDD1 abrogates the hypoxia-induced inhibition of mTOR, and REDD1 overexpression is sufficient to down-regulate S6K phosphorylation in a TSC1/TSC2-dependent manner. Inhibition of mTOR function by hypoxia is likely to be important for tumor suppression as TSC2-deficient cells maintain abnormally high levels of cell proliferation under hypoxia.