Activated pancreatic stellate cells (PSCs) play a pivotal role in the pathogenesis of pancreatic fibrosis, but the detailed mechanism for dysregulated accumulation of extracellular matrix (ECM) remains unclear. Cultured rat PSCs become activated by profibrogenic mediators, but these mediators failed to alter the expression levels of matrix metalloproteinases (MMPs) to the endogenous tissue inhibitors of metalloproteinases (TIMPs). Here, we examined the expression of RECK, a novel membrane-anchored MMP inhibitor, in PSCs. Although RECK mRNA levels were largely unchanged, RECK protein expression was barely detected at 2, 5 days after plating PSCs, but appeared following continued in vitro culture and cell passage which result in PSC activation. When PSCs at 5 days after plating (PSCs-5d) were treated with pepstatin A, an aspartic protease inhibitor, or TGF-beta1, a profibrogenic mediator, RECK protein was detected in whole cell lysates. Conversely, Smad7 overexpression or suppression of Smad3 expression in PSCs after passage 2 (PSCs-P2) led to the loss of RECK protein expression. These findings suggest that RECK is post-translationally processed in pre-activated PSCs but protected from proteolytic degradation by TGF-beta signaling. Furthermore, collagenolytic activity of PSCs-5d was greatly reduced by TGF-beta1, whereas that of PSCs-P2 was increased by anti-RECK antibody. Increased RECK levels were also observed in cerulein-induced acute pancreatitis. Therefore, our results suggest for the first time proteolytic processing of RECK as a mechanism regulating RECK activity, and demonstrate that TGF-beta signaling in activated PSCs may promote ECM accumulation via a mechanism that preserves the protease inhibitory activity of RECK.