Bone morphogenetic proteins (BMPs) are shown to potentiate NGF-induced neuronal differentiation in PC12 phaeochromocytoma cells grown on collagen under low-serum conditions. Whereas, cell bodies remained rounded in control medium or with only BMPs present, addition of BMP4 or BMP6 robustly increased the neuritogenic effect of NGF within 2 days. NGF-increased phosphorylation of p44(Erk1) and p42(Erk2) between 2 and 24h was unaffected by addition of BMP6. PC12 cells transfected with the SBE4x-luc reporter showed that BMP4 significantly increased receptor-activated Smad activity. Expression of constitutively active BNIP receptor ALK2 activating Smad1 and Smad5 resulted in a strong increase in the SBE4x-luc reporter response. Adding the inhibitory Smad7 drastically reduced this signal. In contrast to wild-type (wt) Smad5, a Smad5 variant lacking five Erk phosphorylation sites in the linker region (designated Smad5/5SA) showed a strong background transcriptional activity. A fusion construct (Gal4-Smad5/5SA) was also highly transcriptionally active. Addition of the MEK inhibitor U0126 to PC12 cells expressing Gal4-Smad5/wt did not increase background transcriptional activity. However, upon activation by constitutively active ALK2 both Gal4-Smad5/wt and Gal4-Smad5/5SA strongly stimulated transcription. The data show that serine residues of the linker region of Smad5 reduce spontaneous transcriptional activity and that NGF-activated Erk does not antagonise BMP signalling at this site. Hence, NGF and BMP signals are likely to interact further downstream at the transcriptional level in neuronal differentiation of the PC12 cells. (C) 2003 Elsevier Inc. All rights reserved.