The tumor suppressor Smad4/Dpc4 is a transcription activator that binds specific DNA sequences and whose nuclear localization is induced after exposure to type beta transforming growth factor-like cytokines. We explored an inducible system in which Smad4 protein is activated by translocation to the nucleus when cell lines that stably express wild-type or mutant Smad4 proteins fused to a murine estrogen receptor domain are treated with 4-hydroxytamoxifen. This induced Smad4-mediated transcriptional activation and a decrease in growth rate, attributable to a cell cycle arrest at the G1 phase and an induction of apoptosis. A tumor-derived mutation (Arg-100 --> Thr) affecting a residue critical for DNA-binding demonstrated an "oncogenic" phenotype, having decreases in both the G1 fraction and apoptosis and, consequently, an augmentation of population growth. This model should be useful in the exploration and control of components that lie further downstream in the Smad4 tumor-suppressor pathway.