In order to test the hypothesis that transforming growth factor beta (TGF-beta) acts by FS regulation on bovine granulosa cells in in vitro differentiation, we analyzed the effect of TGF-beta1 on follistatin mRNA expression in three differentiation states of bovine granulosa cells. We showed a positive regulation of FS mRNA after TGF-beta1 (1 ng/ml) treatment of freshly isolated granulosa cells from small-medium antral follicles (2-8 mm). This effect was abolished by the addition of exogenous follistatin (100 ng/ml), suggesting that this effect could be mediated by activin. Although these cells showed a similar effect on FS mRNA expression after treatment with activin-A, a soluble form of activin receptor type IIA was unable to inactivate the TGF-beta effect. When we tested the TGF-beta effect on FS mRNA in different granulosa cell states, TGF-beta1 regulation was associated with progesterone production only in freshly isolated cells. The amount of total activin-A produced by first passage cells (dedifferentiated cells), was ten times smaller than the one measured in a conditioned medium from freshly isolated cells (mature cells). The TGF-beta1-dependent FS mRNA expression persisted in first passage cells without changes with FS addition. On the other hand, the BGC-1 granulosa cell line (immature cells) produced large amounts of activin-A regulated by TGF-beta1 and an invariable steady state of FS mRNAs. In summary, our results showed that FS mRNA expression is regulated by TGF-beta1 independently of activin effects in differentiated granulosa cells.