Recent studies have demonstrated the implication of long noncoding RNAs (lncRNAs) in a variety of physiological and pathological processes. However, the majority of lncRNAs are functionally unknown. The current study describes that the lncRNA MALAT1 regulates TGF-β/Smad signaling pathway through formation of a lncRNA-protein complex containing Smads, SETD2 and PPM1A. Our data show that this lncRNA-proteins complex facilitates the dephosphorylation of pSmad2/3 by providing the interaction niche for pSmad2/3 and their specific phosphatase PPM1A, thus terminating TGF-β/Smad signaling in hepatic cells. Based on these mechanistic studies, we performed further experiments to determine whether depletion of MALAT1 would augment cellular TGF-β/Smad signaling. We observed that MALAT1 depletion enhanced TGF-β/Smad signaling response, as reflect by amplification of Smad-mediated differentiation of induced pluripotent stem (iPS) cells to hepatocytes. Our experimental results demonstrate an important role of MALAT1 for regulation of TGF-β/Smad signaling in hepatic cells. Given the diverse functions of TGF-β/Smad pathway in various physiological and pathogenic processes, our results described in the current study will have broad implications for further understanding the role of MALAT1 in TGF-β/Smad pathway in human biology and disease.