Transforming growth factor (TGF)-beta mediates matrix production in both mesangial and vascular smooth muscle cells. Both TGF-beta and phorboL-12-myristate-13-acetate (PMA) exert both positive and negative effects on mitogenesis in these as well as other cell types. Phorbol esters act through stimulation of protein kinase C (PKC) and are among the most potent tumor promoters known. The present study was conducted to determine if the growth inhibitory effect of TGF-beta parallels that of the phorbol esters and whether this effect of TGF-beta is dependent on activation of PKC. We show that, in vascular Smooth muscle cells stimulated to divide by the addition of the serum component basic fibroblast growth factor (bFGF), TGF-beta 1 inhibits mitogenesis in a dose-dependent manner, by a maximum of 79% when applied at a concentration of 1 ng/ml. Furthermore, the inhibitory effect on mitogenesis of either TGF-beta 1 or PMA, when added four hours after bFGF, are 71% and 84%, respectively. Both TGF-beta 1 and PMA cause translocation of cellular PKC with similar time courses, while neither PKC-alpha nor PKC-beta II are increased in quantity in response to TGF-beta 1. In addition, down-regulation of PKC by 24 hours incubation with PMA abolishes TGF-beta's inhibitory effect in bFGF-stimulated cells. We conclude that (i) the signaling pathway utilized by TGF-beta resulting in inhibition of mitogenesis parallels that of PMA, and (ii) the inhibitory effect of TGF-beta 1 on bFGF-induced mitogenesis is partially due to activation of PKC. These data suggest that TGF-beta may be an endogenous activator of the growth-inhibitory pathway of PKC, and, since cellular differentiated functions generally occur when the cells are proliferation-inhibited, PKC may be a modulator of extracellular matrix deposition.