Transforming growth factor beta (TGFbeta) has been reported to be a potent growth inhibitor of epithelial cells. The purpose of the present work was to study in vitro and in vivo the effects of overexpression of a dominant-negative type II TGFbeta receptor on the proliferation and differentiation of Y-1 cells. Stable transfections were performed with a mutant TbetaRII (TbetaRII-KR) fused with the Enhanced Fluorescent Green Protein (EGFP). The expression of this fusion protein and its overexpression were demonstrated by northern blot and immunoblot with EGFP and TbetaRII probes and antibodies respectively. The membrane localization of this fusion protein was confirmed by confocal microscopy. The functionality of this fusion protein was demonstrated by its blocking effects on TGFbeta action on DNA synthesis and on Y-1 expression of steroidogenic acute regulatory protein (StAR) and 3beta-hydroxysteroid dehydrogenase (3beta-HSD). Moreover, in nude mice the tumorigenicity of cells stably transfected with the fusion protein was higher than that of cells stably transfected with EGFP alone. Taken together, the present results show that TbetaRII-KR/EGFP blocks the effects of TGFbeta1 on Y-1 cells and acts as a potent dominant-negative receptor preventing TGFbeta signaling.