Intimal hyperplasia, the key event of arterial restenosis, is a result of cell proliferation and cell migration. Atorvastatin exerts an inhibitory effect on cell proliferation and migration, but the mechanism remains largely unknown. p16, as a well‐known tumor suppressor, was also reported to suppress cell growth and migration, but with an unclear mechanism. In this study, we demonstrated that atorvastatin represses cell proliferation and migration in vascular smooth muscle cells (VSMCs) and that this process is mediated by p16. Furthermore, we found that DNA methylation in the p16 promoter was reduced and p16 expression was restored in VSMCs treated with 5‐aza‐2′‐deoxycytidine or atorvastatin. However, the effect was absent when DNA methyltransferase 1 (DNMT1) was knocked down with RNA interference. These observations demonstrated that atorvastatin regulates p16 expression via DNMT1‐induced DNA methylation in the p16 promoter. In addition, we found that the mitogen‐activated protein kinase (MAPK) pathway was involved in the regulation of p16 by DNMT1, and MAPK inhibitors partially released the effects of atorvastatin on p16 and DNMT1. Finally, we illustrated that atorvastatin inhibits neointima formation and modulates p16 expression in balloon catheter‐injured rat carotid artery. Taken together, we demonstrated that atorvastatin inhibits neointima formation through inducing p16 expression by affecting DNA methylation in the p16 promoter region.