Members of the TGF-beta family of growth factors mediate their effects through activation of intracellular Smad proteins, which form transcriptionally competent complexes that accumulate in the nucleus. Recently, several reports have demonstrated that Smads actively shuttle between the cytoplasm and nucleus by distinct mechanisms. Here, we summarize what is known about the dynamics of Smad localization and suggest reasons why nucleocytoplasmic shuttling might be important for proper signal transduction.