Recent studies suggest a positive correlation between glycogen synthase kinase-3 (GSK-3) activation and tumor growth. Currently, it is unclear how both Akt that inhibits GSK-3 and active GSK-3 are maintained concurrently in tumor cells. We investigated the role of GSK-3 and the existence of an Akt-resistant pathway for GSK-3 activation in prostate cancer cells. Our data show that Src, a non-receptor tyrosine kinase is responsible for Y216 GSK-3 phosphorylation leading to its activation even when Akt is active. Experiments involving mouse embryonic fibroblasts lacking cSrc, Yes and Fyn, as well as Src activity modulation in prostate cancer cells with constitutively active (CA-Src) and dominant negative Src (DN-Src) plasmids demonstrated the integral role of Src in Y216 GSK-3 phosphorylation and activity modulation. Inhibition of GSK-3 with SB415286 in PC3 cells resulted in impaired motility, proliferation and colony formation. Treatment of PC3 cells with the Src inhibitor dasatinib reduced Y216 GSK-3 phosphorylation and inhibited proliferation, invasion and micrometastasis in vitro. Dasatinib treatment of athymic nude mice resulted in impaired growth of PC3 cell tumor xenograft. Together, we provide novel insight into the Src-mediated Y216 GSK-3 phosphorylation and activation in prostate cancer cells and reveal the potential benefits of targeting Src-GSK-3 axis using drugs such as dasatinib.