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The MAD-related protein Smad7 associates with the TGFbeta receptor and functions as an antagonist of TGFbeta signaling.

TGFbeta signaling is initiated when the type I receptor phosphorylates the MAD-related protein, Smad2, on C-terminal serine residues. This leads to Smad2 association with Smad4, translocation to the nucleus, and regulation of transcriptional responses. Here we demonstrate that Smad7 is an inhibitor of TGFbeta signaling. Smad7 prevents TGFbeta-dependent formation of Smad2/Smad4 complexes and inhibits the nuclear accumulation of Smad2. Smad7 interacts stably with the activated TGFbeta type I receptor, thereby blocking the association, phosphorylation, and activation of Smad2. Furthermore, mutations in Smad7 that interfere with receptor binding disrupt its inhibitory activity. These studies thus define a novel function for MAD-related proteins as intracellular antagonists of the type I kinase domain of TGFbeta family receptors.