A nontransformed rat jejunal crypt cell line (IEC-6) expresses transforming growth factor type beta 1 (TGF-beta 1) mRNA, secretes latent 125I-labeled TGF-beta 1 competing activity into culture medium, and binds 125I-labeled TGF-beta 1 to specific, high-affinity (Kd = 3.7 pM) cell surface receptors. IEC-6 cell growth is markedly inhibited by TGF-beta 1 and TGF-beta 2 with half-maximal inhibition occurring between 0.1 and 1.0 ng of TGF-beta 1 per ml. TGF-beta 1-mediated growth inhibition is not associated with the appearance of biochemical markers of enterocyte differentiation such as alkaline phosphatase expression and sucrase activity. TGF-beta 1 (10 ng/ml) increases steady-state levels of its own mRNA expression within 8 hr of treatment of rapidly growing IEC-6 cells. In freshly isolated rat jejunal enterocytes that are sequentially eluted from the crypt villus axis, TGF-beta 1 mRNA expression is most abundant in terminally differentiated villus tip cells and least abundant in the less differentiated, mitotically active crypt cells. We conclude that TGF-beta 1 is an autoregulated growth inhibitor in IEC-6 cells that potentially functions in an autocrine manner. In the rat jejunal epithelium, TGF-beta 1 expression is most prominently localized to the villus tip--i.e., the region of the crypt villus unit that is characterized by the terminally differentiated phenotype. These data suggest that TGF-beta 1 may function in coordination of the rapid cell turnover typical for the intestinal epithelium.