Treatment of human MG-63 osteosarcoma cells with human recombinant transforming growth factor beta 1 (TGF-beta 1) was found to inhibit cell proliferation. In addition, 1,25-dihydroxyvitamin D3 [1,25(OH)2D3]-induced osteocalcin synthesis was greatly influenced by TGF-beta 1. Dose- and time-dependent inhibition was seen both in medium osteocalcin and the corresponding mRNA concentrations. Furthermore, TGF-beta 1 decreased osteocalcin synthesis modulated negatively by dexamethasone or positively by retinoic acid. The stability of osteocalcin mRNA was not decreased by the TGF-beta 1 treatment, but in vitro transcription assays demonstrated diminished osteocalcin gene transcription caused by the TGF-beta 1 treatment. Binding of vitamin D receptor (VDR) to an oligonucleotide probe containing the osteocalcin vitamin D response element (VDRE) was not influenced by TGF-beta 1, however. Incubation of the cells with the serine/threonine kinase inhibitor H-7 did not block the ability of TGF-beta 1 to decrease osteocalcin synthesis but caused a further inhibition. Also, the 1,25(OH)2D3-induced osteocalcin synthesis was decreased by H-7 treatment, suggesting that phosphorylation as such is involved in the transcriptional activation mechanism of VDR. These results demonstrate that TGF-beta 1 is a strong inhibitor of the synthesis of osteocalcin, a calcium binding protein participating in bone mineralization, by counteracting the stimulatory effects of other hormones on its synthesis. We further suggest that TGF-beta 1 affects the synthesis of osteocalcin at the level of transcription through mechanism(s) different from the serine/threonine kinase pathway.