Smad2 (58kD) is a family member of proteins involved in cell proliferation, differentiation and development. The Smad family is divided into three subclasses: (1) the receptor-regulated Smads (activin/TGF-beta receptor-regulated [Smad2 and 3] or BMP receptor regulated [Smad1, 5 and 8]); (2) the common partner (Smad4), that functions via its interaction to the various Smads; and (3) the inhibitory Smads, (Smad6 and Smad7). Smad2 consists of two highly conserved domains, the Nterminal Mad homology (MH1) and the C-terminal Mad homology 2 (MH2) domains. The MH1 domain binds DNA and regulates nuclear import and transcription while the MH2 domain, conserved among all the Smads, regulates Smad2 oligomerization and binding to cytoplasmic adaptors and transcription factors. Activated Smad2 associates with Smad4 and translocates as a complex into the nucleus, allowing its binding to DNA and transcription factors. This translocation of Smad2 (as well as Smad3) into the nucleus is a central event in TGF-beta signaling. Phosphorylation of the two TGF-beta-dependent serines 465 and 467 in the C-terminus of Smad2 provides a recognition site for interaction with Smad4. The phosphorylation of Smad2 on these two serine sites is critical for Smad2 transcriptional activity and TGF--beta signaling.