Smooth muscle cell (SMC) differentiation is regulated by a complex array of local environmental cues, but the intracellular signaling pathways and the transcription mechanisms that regulate this process are largely unknown. We and others have shown that serum response factor (SRF) contributes to SMC-specific gene transcription, and because the small GTPase RhoA has been shown to regulate SRF, the goal of the present study was to test the hypothesis that RhoA signaling is a critical mechanism for regulating SMC differentiation. Coexpression of constitutively active RhoA in rat aortic SMC cultures significantly increased the activity of the SMC-specific promoters, SM22 and SM alpha-actin, whereas coexpression of C3 transferase abolished the activity of these promoters. Inhibition of either stress fiber formation with the Rho kinase inhibitor Y-27632 (10 microm) or actin polymerization with latrunculin B (0.5 microm) significantly decreased the activity of SM22 and SM alpha-actin promoters. In contrast, increasing actin polymerization with jasplakinolide (0.5 microm) increased SM22 and SM alpha-actin promoter activity by 22-fold and 13-fold, respectively. The above interventions had little or no effect on the transcription of an SRF-dependent c-fos promoter or on a minimal thymidine kinase promoter that is not SRF-dependent. Taken together, the results of these studies indicate that in SMC, RhoA-dependent regulation of the actin cytoskeleton selectively regulates SMC differentiation marker gene expression by modulating SRF-dependent transcription. The results also suggest that RhoA signaling may serve as a convergence point for the multiple signaling pathways that regulate SMC differentiation.