The retinoblastoma protein (Rb), a key regulator of cell cycle progression, can bind the transcription factor E2F converting it from a positive transcriptional factor capable of driving cells into S phase into a negative complex which arrests cells in G1. We have created a potent transcriptional repressor of E2F-dependent transcription by fusing the C-terminal fragment of Rb (p56) to the DNA and DP1-binding domains of E2F. Because the expression of E2F/56 fusion protein from a constitutive promoter was incompatible with virus growth, adenovirus constructs were prepared where transgenes were expressed from a fragment of the smooth muscle alpha-actin (SMA) promoter. Immunoblot and beta-galactosidase staining demonstrated smooth muscle-specific expression of this transcriptional element in vitro. The SMA-p56 and SMA-E2F/p56 adenoviral constructs also induced G0/G1 cell cycle arrest specifically in smooth muscle cells. Following administration to rat tissues, the SMA-beta-galactosidase construct exhibited expression in balloon-injured carotid arteries, but not in liver, bladder or skeletal muscle. Local delivery of the SMA-E2F/p56 adenoviral construct to balloon-injured carotid arteries inhibited intimal hyperplasia. Our results demonstrate that local delivery of the SMA-E2F/p56 adenoviral construct can limit intimal hyperplasia in balloon-injured vessels, while avoiding toxicity that could occur from the dissemination and expression of the viral transgene.