The recent identification of the SMAD family of signal transducer proteins has unravelled the mechanisms by which transforming growth factor-beta (TGF-beta) signals from the cell membrane to the nucleus. Pathway-restricted SMADs are phosphorylated by specific cell-surface receptors that have serine/threonine kinase activity, then they oligomerize with the common mediator Smad4 and translocate to the nucleus where they direct transcription to effect the cell’s response to TGF-beta. Inhibitory SMADs have been identified that block the activation of these pathway-restricted SMADs.