Transforming growth factor beta (TGFbeta) both inhibits proliferation of macrovascular endothelial cells and promotes their transdifferentiation to alpha-smooth-muscle-actin (alphaSMA)-expressing mesenchymal cells in vitro. Recently, we have confirmed that proliferation of immortalized bovine retinal microvascular endothelial cells (iBREC) is strongly inhibited by TGFbeta2. We now demonstrate a complete transition of both parental iBREC and single cell-derived subclones from cobblestone morphology to a ragged appearance as a consequence of incubation for a few days with 10 ng/ml TGFbeta1 or TGFbeta2. Depending on the type of culture medium, 5-40% of these cells strongly expressed alphaSMA after approximately 6 days whereas expression of the endothelial cell-specific marker proteins von Willebrand factor and VE Cadherin (CD144) declined. Expression of alphaSMA, associated with formation of stress fibers, was first detected in single cells and then spread to adjacent cells, and declined slowly after prolonged cultivation in medium without TGFbeta2. However, re-constitution of vWF expression was not observed. TGFbeta2-induced phenotypic alterations were specific, as they were not caused by treatment of iBREC with VEGF, IGF-1 or bFGF. Induction of alphaSMA expression but not effects on morphology was strongly inhibited by bFGF, whereas IGF-1 enhanced TGFbeta2-induced alphaSMA expression. These findings may have an important impact on the understanding of development of microvascular complications of diabetes such as diabetic retinopathy.