In the present study, we have analysed the effects of transforming growth factor-beta (TGF-beta) signaling on the growth behavior of pancreatic carcinoma cells in vitro and on their tumorigenicity in vivo. Ectopic expression of dominant-negative mutants of the TGF-beta type II receptor or type I receptor/activin receptor-like kinase 5 (ALK5) in TGF-beta-sensitive pancreatic ductal adenocarcinoma PANC-1 cells prevented the TGF-beta-induced activation of transfected Smad-responsive reporter genes and growth arrest. The growth-inhibitory effect was mimicked by stable expression of kinase-active ALK5 (ALK5-T204D), and was dependent on ALK5's ability to activate Smad signaling, as a ALK5-derived mutant with an intact kinase domain but deficient in its ability to activate Smads (RImL45) failed to suppress proliferation in the absence of added TGF-beta. Moreover, this mutant often displayed opposite effects to those of ALK5-TD and blocked various ligand-induced responses in vitro, indicating that it acts in a dominant-negative fashion to inhibit endogenous wild-type receptors. ALK5-TD-, but not RImL45-TD-transduced cells underwent epithelial-to-mesenchymal transition, exhibited a higher ratio of thrombospondin-1 to vascular endothelial growth factor-A expression and upregulated various metastasis-associated genes. Upon orthotopic transplantation of PANC-1 clones into immunodeficient mice, ALK5-TD, but not RImL45-TD, greatly reduced tumor size and induced the formation of liver metastases in otherwise non-metastatic PANC-1 cells. These results suggest a causal, dominant role for the endogenous Smad2/3 signaling pathway in the tumor suppressor and prometastatic activities of TGF-beta in pancreatic tumor cells.