Restenosis is the major obstacle interfering with a successful long-term outcome of balloon angioplasty. Neointima formation following endothelial injury is the result of phenotype modulation and proliferation of smooth muscle cells (SMC). To characterize these time-dependent changes, a rat balloon injury model of carotid artery restenosis was assessed. We applied monoclonal antibodies recognizing desmin, sm-alpha-actin and smoothelin, a novel marker specific for the differentiated phenotype of SMC. Neointima formation could be seen from day 7 after injury onwards. During early phases, the number of smoothelin-positive cells in the media was decreased compared with uninjured controls. Smoothelin staining was absent in the neointima during formation. Increased levels of smoothelin in both media and neointima were observed at days 28 and 56, correlating with a decrease in proliferation as assessed by Ki-67 antigen staining. No such changes were observed for desmin and sm-alpha-actin. Following balloon injury, SMC in both the media and the neointima underwent an early, reversible dedifferentiation, followed by proliferation. The novel SMC-specific marker protein smoothelin can be used to monitor this SMC (de) differentiation in neointima and media. These findings support the pivotal role of SMC phenotype modulation in neointima formation and restenosis.