Smad proteins transduce signals carried by the transforming growth factor beta (TGF-beta) cytokine superfamily from receptor serine/threonine kinases at the cell surface to the nucleus, thereby affecting cell proliferation, differentiation, as well as pattern formation during early vertebrate development. Smad4/DPC4, located at chromosome 18q21, was identified as a candidate tumor suppressor gene that is inactivated in nearly half of all pancreatic carcinomas. For functional characterization of Smad4, a recombinant adenovirus encoding Smad4 (Ad-Smad4) was generated. When Smad4 was expressed in Smad4-null breast carcinoma cell line MDA-MB-468 using the recombinant adenovirus, TGF-beta signaling was restored as determined by TGF-beta-dependent activity of plasminogen activator inhibitor 1 promoter and p21 expression. Infection with Ad-Smad4 in the presence of TGF-beta1 also resulted in an altered cell morphology that coincided with enhanced beta1 integrin expression and reduced efficiency of colony formation in soft agar. In agreement with increased p21 expression, Smad4-expressing cells showed modest reduction in S phase. However, Smad4 expression did not lead to induction of apoptosis under normal culture conditions. Interestingly, when Smad4-expressing cells were detached and incubated in suspension, they underwent rapid apoptosis in a TGF-beta-dependent manner. Induction of apoptosis caused by loss of anchorage is known as anoikis. Anoikis is believed to prevent colonization elsewhere of detached cells. Additional characterization revealed an increase in the level of focal adhesion kinase 2 (or Pyk2) and activation of caspases 2, 3, 6, and 8 during anoikis because of Smad4 expression and restoration of TGF-beta signaling. Because resistance to anoikis in tumor cells is thought to contribute to metastasis, our data suggest a functional basis for the strong correlation between defects in Smad4 and development of malignancy.