Various osteoblastic cell lines were examined for the relationship between the presence of cell-surface transforming growth factor (TGF)-beta receptors and the synthesis of matrix proteins with their responsiveness to TGF-beta. Treatment with TGF-beta 1 inhibited proliferation and stimulated proteoglycan and fibronectin synthesis in MC3T3-E1 and MG 63 cells. The major proteoglycans synthesized by these cells were decorin and biglycan, and TGF-beta 1 markedly stimulated the synthesis of decorin in MC3T3-E1 and of biglycan in MG 63 cells. SaOS 2 and UMR 106 cells synthesized barely detectable amounts of decorin or biglycan, and TGF-beta 1 did not stimulate the synthesis of these proteoglycans. In SaOS 2 cells, however, TGF-beta 1 enhanced fibronectin synthesis. TGF-beta 1 did not show any of these effects in UMR 106 cells. Receptor cross-linking studies revealed that only MC3T3-E1 and MG 63 cells had both types I and II signal-transducing receptors for TGF-beta in addition to betaglycan. SaOS 2 cells possessed type I but no type II receptor on the cell surface. In contrast, SaOS 2 as well as MC3T3-E1 and MG 63 cells expressed type II receptor mRNA by Northern blot analysis, and cell lysates contained type II receptor by Western blot analysis. Thus, it appears that type II receptor present in SaOS 2 cells is not able to bind TGF-beta 1 under these conditions. UMR 106 cells with no response to TGF-beta 1 had neither of the signal-transducing receptors by any of the analyses. These observations using clonal osteoblastic cell lines demonstrate that the ability of osteoblastic cells to synthesize bone matrix proteoglycans is associated with the responsiveness of these cells to TGF-beta 1, that the responsiveness of osteoblastic cells to TGF-beta 1 in cell proliferation and proteoglycan synthesis correlates with the presence of both types I and II receptors, and that the effect of TGF-beta 1 on fibronectin synthesis can develop with little binding of TGF-beta 1 to type II receptor if type I receptor is present. It is suggested that the combination of cell-surface receptors for TGF-beta determines the responsiveness of osteoblastic cells to TGF-beta and that changes in cell-surface TGF-beta receptors may play a role in the regulation of matrix protein synthesis and bone formation in osteoblasts.