The C-terminal 95 kDa fragment of some isoforms of vertebrate agrins is sufficient to induce clustering of acetylcholine receptors but despite two decades of intense agrin research very little is known about the function of the other isoforms and the function of the larger, N-terminal part of agrins that is common to all isoforms. Since the N-terminal part of agrins contains several follistatin-domains, a domain type that is frequently implicated in binding TGFbetas, we have explored the interaction of the N-terminal part of rat agrin (Agrin-Nterm) with members of the TGFbeta family using surface plasmon resonance spectroscopy and reporter assays. Here we show that agrin binds BMP2, BMP4 and TGFbeta1 with relatively high affinity, the K(D) values of the interactions calculated from SPR experiments fall in the 10(-8) M-10(-7) M range. In reporter assays Agrin-Nterm inhibited the activities of BMP2 and BMP4, half maximal inhibition being achieved at approximately 5x10(-7) M. Paradoxically, in the case of TGFbeta1 Agrin N-term caused a slight increase in activity in reporter assays. Our finding that agrin binds members of the TGFbeta family may have important implications for the role of these growth factors in the regulation of synaptogenesis as well as for the role of agrin isoforms that are unable to induce clustering of acetylcholine receptors. We suggest that binding of these TGFbeta family members to agrin may have a dual function: agrin may serve as a reservoir for these growth factors and may also inhibit their growth promoting activity. Based on analysis of the evolutionary history of agrin we suggest that agrin's growth factor binding function is more ancient than its involvement in acetylcholine receptor clustering.