Betaglycan is a membrane-anchored proteoglycan co-receptor that binds transforming growth factor beta (TGF-beta) via its core protein and basic fibroblast growth factor through its glycosaminoglycan chains. In this study we evaluated the expression of betaglycan during the C(2)C(12) skeletal muscle differentiation. Betaglycan expression, as determined by Northern and Western blot, was up-regulated during the conversion of myoblasts to myotubes. The mouse betaglycan gene promoter was cloned, and its sequence showed putative binding sites for SP1, Smad3, Smad4, muscle regulatory factor elements such as MyoD and MEF2, and retinoic acid receptor. Transcriptional activity of the mouse betaglycan promoter reporter was also up-regulated in differentiating C(2)C(12) cells. We found that MyoD, but not myogenin, stimulated this transcriptional activity even in the presence of high serum. Betaglycan promoter activity was increased by RA and inhibited by the three isoforms of TGF-beta. On the other hand, basic fibroblast growth factor, BMP-2, and hepatocyte growth factor/scatter factor, which are inhibitors of myogenesis, had little effect. In myotubes, up-regulated betaglycan was also detectable by TGF-beta affinity labeling and immunofluorescence microscopy studies. The latter indicated that betaglycan was localized both on the cell surface and in the ECM. Forced expression of betaglycan in C(2)C(12) myoblasts increases their responsiveness to TGF-beta2, suggesting that it performs a TGF-beta presentation function in this cell lineage. These results indicate that betaglycan expression is up-regulated during myogenesis and that MyoD and RA modulate its expression by a mechanism that is independent of myogenin.