TGFbeta signaling regulates central cellular processes such as proliferation and extracellular matrix production during development of the orofacial region. Extracellular TGFbeta binds to cell surface receptors to activate the nucleocytoplasmic Smad proteins that, along with other transcription factors and cofactors, bind specific DNA sequences in the promoters of target genes to regulate their expression. To determine the identity of Smad binding proteins that regulate TGFbeta signaling in developing murine orofacial tissue, a yeast two-hybrid screening approach was employed. The PR-domain containing protein, PRDM16/MEL1 was identified as a novel Smad binding protein. The interaction between PRDM16/MEL1 and Smad 3 was confirmed by GST pull-down assays. The expression of PRDM16/MEL1 was detected in developing orofacial tissue by both Northern blot and in situ hybridization. PRDM16/MEL1 was constitutively expressed in orofacial tissue on E12.5-E14.5 as well as other embryonic tissues such as heart, brain, liver, and limb buds. Taken together, these results demonstrate that PRDM16/MEL1 is a Smad binding protein that may be important for development of orofacial structures through modulation of the TGFbeta signaling pathway.