The recruitment and proliferation of smooth muscle cells and pericytes are two key events for the stabilization of newly formed capillaries during angiogenesis and, when out of control in the adult, are the main causes of arteriosclerosis. We have identified a novel gene, named VE‐statin for vascular endothelial‐statin, which is expressed specifically by endothelial cells of the developing mouse embryo and in the adult, and in early endothelial progenitors. The mouse and human VE‐statin genes have been located on chromosome 2 and 9, respectively, they span> 10 kbp and are transcribed in two major variants arising from independent initiation sites. The VE‐statin transcripts code for a unique protein of 30 kDa that contains a signal peptide and two epidermal growth factor (EGF)‐like modules. VE‐statin is found in the cellular endoplasmic reticulum and secreted in the cell supernatant. Secreted VE‐statin inhibits platelet‐derived growth factor (PDGF)‐BB‐induced smooth muscle cell migration, but has no effects on endothelial cell migration. VE‐statin is the first identified inhibitor of mural cell migration specifically produced by endothelial cells.