Type beta transforming growth factors (TGF) are disulfide-linked homo- and heterodimers of two related polypeptide chains, beta 1 and beta 2. The homodimers TGF-beta 1 and TGF-beta 2 are widely distributed, but the heterodimer TGF-beta 1.2 has been found only in porcine platelets (Cheifetz, S., Weatherbee, J.A., Tsang, M.L.-S., Anderson, J.K., Mole, J.E., Lucas, R., and Massagué, J. (1987) Cell 48, 409-415). Here we characterize the receptor binding and biological properties of TGF-beta 1.2 and compare them with those of TGF-beta 1 and TGF-beta 2. Three types of cell surface receptors previously identified by affinity labeling with 125I-TGF-beta 1 are available for binding to TGF-beta 1.2. These three types of receptors are detected as 65-kDa (type I), 85-95-kDa (type II), and 250-350-kDa (type III) affinity-labeled receptor complexes on electrophoresis gels. They co-exist in many cell types, have high affinity for TGF-beta 1, and varying degrees of affinity for TGF-beta 2. Of the 11 cell lines screened in the present study none showed evidence for additional receptor types that would bind TGF-beta 2 but not TGF-beta 1. In receptor competition studies, TGF-beta 1, TGF-beta 1.2, and TGF-beta 2 competed for binding to type I and type II receptors with a relative order of potencies of 16:5:1 and 12:3:1, respectively, whereas all three forms of TGF-beta were equipotent as ligands for the type III receptors. The three forms of TGF-beta were equally potent at stimulating the biosynthesis of extracellular sulfated proteoglycan in BRL-3A rat liver epithelial cells, a response that presumably involves the type III receptor present in these cells. In contrast, the ability of the three ligands to inhibit the growth of B6SUt-A multipotential hematopoietic progenitor cells which display only type I receptors decreased in the order TGF-beta 1, TGF-beta 1.2, and TGF-beta 2 with a relative potency of 100:30:1. The results indicate that the presence of one beta 1 chain in TGF-beta 1.2 increases (with respect to TGF-beta 2) the biological potency and binding affinity toward receptor types I and II, but the presence of a second beta 1 chain in the dimer is required for full potency.