Transforming growth factor-beta (TGF-beta) is capable of affecting the proliferation of many cell types. To identify novel genes whose protein products may mediate cellular responses to this factor, a cDNA library was made from mRNA isolated from a human lung adenocarcinoma cell line (A549) that had been treated for 3 days with TGF-beta. The library was screened by differential hybridization and a cDNA clone, beta ig-h3, was isolated. This gene was induced up to 20-fold in A549 cells after 2 days of treatment with TGF-beta 1. It was also induced in several other cell lines, including PC-3 and H2981. DNA sequence analysis of beta ig-h3 indicated that it encoded a novel protein, beta IG-H3, of 683 amino acids, which contained an amino-terminal secretory sequence and a carboxy-terminal Arg-Gly-Asp (RGD) sequence that can serve as a ligand recognition site for several integrins. beta IG-H3 also contained short amino acid regions homologous to similar regions in Drosophila fasciclin-I and four homologous internal domains, which can be folded into a potential bivalent structure and could act as a bridge between cells expressing the appropriate ligand. beta ig-h3 RNA was detected in several cell lines and tissues. COS cells transfected with plasmids encoding beta IG-H3 secreted a major 68-kD protein that was detected by immunoblotting using antipeptide antibodies. Since beta ig-h3 is induced in several cell lines whose proliferation is affected by TGF-beta 1, it may be involved in mediating some of the signals of this multifunctional growth modulator.