The aim of this study was to characterize the mechanism of transforming growth factor (TGF)-beta1-mediated alteration of renal proximal tubular cell phenotype. TGF-beta1 altered cell phenotype, with cells appearing elongated and spindle shaped. This was associated with loss of cell-cell contact and rearrangement of the actin cytoskeleton, increased formation of stress fibers, and focal adhesions. Addition of the tyrosine phosphatase inhibitor sodium orthovanadate also led to rapid but transient loss of cell-cell contact, but it did not lead to a change of phenotype comparable to that seen following addition of TGF-beta1. There was, however, no change in the formation of focal adhesions and no associated reorganization of the Factin cytoskeleton. Disruption of the actin cytoskeleton with cytochalasin D prevented phenotypic alterations following addition of TGF-beta1. Transient transfection with Smad2/4 or Smad3/4 expression vectors did not alter cell phenotype. Previously, we demonstrated beta-catenin translocation to proximal tubule cell nuclei and its association with Smad proteins following addition of TGF-beta1, suggesting the possibility that TGF-beta1 may modulate Wnt signaling. The Wnt-responsive Xtwn-reporter construct was, however, silent in response to TGF-beta1. Similarly, a second Wnt/LEF-1-regulated element, Toplflash, which does not contain Smad binding sites, was insensitive to TGF-beta1 signaling. In contrast, phenotypic changes in response to TGF-beta1 were abrogated by inhibitors of the RhoA downstream target ROCK, which also prevented loss of cell-cell contact and adherens junction disassembly.