TGF-beta1 has been known to suppress the growth of gastric cancer cells. Interestingly, TGF-beta1 treatment increased the proliferation of human gastric cancer cell line, SNU-216 cells, while it reduced the proliferation of other tumor cells including SNU-620 cells. TGF-beta1-mediated down-regulation of c-Myc and induction of p21CIP1 were observed in SNU-620, but there was no change in SNU-216 in response to TGF-beta1. Similarly, TGF-beta1 receptors were upregulated by TGF-beta1 treatment in SNU-620, but they were not responded in SNU-216. By a single strand conformation polymorphism analysis, a repeated insertion of 37 nucleotides in the exon 8 of Smad4, resulting in premature termination at codon 362, was found in SNU-216. Furthermore, this truncated Smad4 functioned as a dominant negative form in TGF-beta1-mediated reporter activity and TGF-beta1 receptor expression. However, the proliferation of tumor cells was not affected by Smad4 mutation, but it was modulated by PD98059. Taken together, a mutation in Smad4 in addition to mitogen-activated protein kinase altered the TGF-beta1-mediated signaling, which is one of key events of gastric tumorigenesis.