Tyrosine kinase growth factor receptor signaling influences proliferation, survival, and apoptosis. Hair follicles undergo cycles of proliferation and apoptotic regression, offering an excellent paradigm to study how this transition is governed. Several factors are known to affect the hair cycle, but it remains a mystery whether Akt kinases that are downstream of growth factor signaling impact this equilibrium. We now show that an Akt relative, Sgk (serum and glucocorticoid responsive kinase) 3, plays a critical role in this process. Hair follicles of mice lacking Sgk3 fail to mature normally. Proliferation is reduced, apoptosis is increased, and follicles prematurely regress. Maintenance of the pool of transiently amplifying matrix cells is impaired. Intriguingly, loss of Sgk3 resembles the gain of function of epidermal growth factor signaling. Using cultured primary keratinocytes, we find that Sgk3 functions by negatively regulating phosphatidylinositol 3 kinase signaling. Our results reveal a novel and important function for Sgk3 in controlling life and death in the hair follicle.