Transforming growth factor-beta (TGF-beta) regulates cell proliferation positively or negatively. The mitoinhibition by TGF-beta has been attributed to induction of cyclin-dependent kinase (CDK) inhibitors, such as p15/ Ink4B, p27/Kip1, and p21/Waf1 also known as Cip1 and Sdi1. However, the biological process by which TGF-beta exerts the stimulatory effects on cell growth remains poorly understood. Here we report that TGF-beta 1 stimulates DNA synthesis of IMR-90 human embryonic lung fibroblasts but inhibits that of HuCCT1 human cholangiocarcinoma cells, via down- or up-regulation of p21/Waf1, respectively. TGF-beta 1 markedly suppresses IMR-90 cells to express two different kinds of the p21/Waf1 gene transcription factors, the p53 tumor suppressor and the interferon regulatory factor-1 (IRF-1). This is followed by a marked decrease in expression of p21/Waf1 in a manner consistent with the timing of activation of cyclin E-associated kinase, which normally accompanies the G1-S transition in the cell cycle. Contrarily, TGF-beta 1-induced inhibition of DNA synthesis in HuCCT1 cells is preceded by IRF-1-dependent but p53-independent up-regulation of p21/Waf1 expression followed by inactivation of cyclin E-associated kinase. Thus the cell growth stimulation or inhibition by TGF-beta 1 are mediated by the down- or up-regulation of p21/ Waf1, respectively.