The lymphoid enhancer-binding factor (Lef-1) transcription factor is best known for the ability to transduce Wnt signals during development and to mediate excessive Wnt signaling in certain types of cancer. We recently identified and characterized a novel Wnt-like effect of transforming growth factor-beta (TGF-beta) on beta-catenin, the binding partner of Lef-1. Therefore, we sought to determine the effect of TGF-beta on expression of the Lef/T-cell-specific transcription factor (TCF) components of the Wnt pathway. We found that TGF-beta markedly induced Lef-1 mRNA expression in cell lines originating from fetal lung (Mv1Lu) and newborn skin (Balb/MK), tissues that normally express Lef-1 during development. Lef-1 induction was temporally related to but independent of TGF-beta-induced G1 cell cycle arrest. Furthermore, the induction of Lef-1 was independent of both new protein synthesis and Smad-mediated signaling. Using TGF-beta-treated Mv1Lu cells, we identified multiple splice forms of Lef-1, including novel variants that lack both exons 2 and 3. We conclude that the induction of Lef-1 has permissive effects on the well-characterized TGF-beta signal that inhibits c-myc expression and induces a G1 arrest. Copyright 2005 Wiley-Liss, Inc.