Transforming growth factor-beta (TGF-beta)-Smad signaling pathway participates in the regulation of a variety of cellular activities. Unlike the high incidences of Smad4 mutation or deletion in pancreatic cancer and gastrointestinal cancers, Smad4 gene is seldom mutated or deleted in hepatocellular carcinoma (HCC). The role of TGF-beta-Smad4 signaling pathway in leading to carcinogenesis of liver cells remains unknown. In this study, we succeeded in silencing Smad4 using lentiviral-mediated Smad4 RNA interference (RNAi). We investigated the role of Smad4 in TGF-beta1-induced cell proliferation and apoptosis of HCC cell line SMMC-7721. We determined cell proliferation, apoptosis, and expression of p21, p16, p53 and caspase 3. Results showed that TGF-beta1 not only had a significant anti-proliferation effect but also induced cellular apoptosis in SMMC-7721 cells. These effects induced by TGF-beta1 were almost completely blocked by the knockdown of Smad4. Western blot analysis revealed that p16 was up-regulated and caspase 3 was activated by silencing of Smad4, and the expression of p21 and wild-type p53 were not affected. These results suggest that TGF-beta1-induced cell growth inhibition by up-regulating p16 expression and cellular apoptosis by activating caspase 3 was Smad4-dependent. Additionally, the knock down of a specific gene using lentiviral-mediated RNAi appears to be a promising tool and strategy for analyzing endogenous gene function.