In gastrointestinal cells, biological signals for transforming growth factor-beta (TGF-beta) are transduced through transmembrane serine/threonine kinase receptors that signal to Smad proteins. Smad4, a tumor suppressor, is often mutated in human gastrointestinal cancers. The mechanism of Smad4 inactivation, however, remains uncertain and could be through E3-mediated ubiquitination of Smad4/adaptor protein complexes. Disruption of ELF (embryonic liver fodrin), a Smad4 adaptor protein, modulates TGF-beta signaling. We have found that PRAJA, a RING-H2 protein, interacts with ELF in a TGF-beta-dependent manner, with a fivefold increase of PRAJA expression and a subsequent decrease in ELF and Smad4 expression, in gastrointestinal cancer cell lines (P < 0.05). Strikingly, PRAJA manifests substantial E3-dependent ubiquitination of ELF and Smad3, but not Smad4. Delta-PRAJA, which has a deleted RING finger domain at the C terminus, abolishes ubiquitination of ELF. A stable cell line that overexpresses PRAJA exhibits low levels of ELF in comparison to a Delta-PRAJA stable cell line, where ELF expression is high compared to normal controls. The alteration of ELF and/or Smad4 expression and/or function in the TGF-beta signaling pathway may be induced by enhancement of ELF degradation, which is mediated by a high-level expression of PRAJA in gastrointestinal cancers. In hepatocytes, half-life (t(1/2)) and rate constant for degradation (k(D)) of ELF is 1.91 h and 21.72 min(-1) when coupled with ectopic expression of PRAJA in cells stimulated by TGF-beta, compared to PRAJA-transfected unstimulated cells (t(1/2) = 4.33 h and k(D) = 9.6 min(-1)). These studies reveal a mechanism for tumorigenesis whereby defects in adaptor proteins for Smads, such as ELF, can undergo degradation by PRAJA, through the ubiquitin-mediated pathway.