The field of transforming growth factor-beta (TGF-beta) signaling sees periodic discoveries that revolutionize our thinking, redirect our experiments, and peak our excitement. One of the first such discoveries was less than a decade ago: the molecular cloning of the type I and type II TGF-beta receptors. This breakthrough defined a novel family of serine/threonine kinase receptors, which led to the description of an ever-expanding superfamily. The discovery of how these receptors are grouped on the cell surface, bind TGF-beta and are activated by specific phosphorylation events further defined the uniqueness of this system in comparison to other families of growth factor receptors. Now, once again, the TGF-beta field has been revolutionized. This time, the discovery is the Smad family of proteins. Although one can hardly imagine TGF-beta without the Smads, the cloning of the Smads and their implication in TGF-beta signaling was only four years ago. Since that time, great advances have been made in our understanding of the Smads as transcription factors, which are activated by receptor mediated phosphorylation. In addition, animal models for a loss of Smad function have provided insight into the role of specific Smads in a variety of physiologic systems. The Smad field has been growing exponentially. A comprehensive review of all aspects of the Smads, therefore, would be beyond the scope of a single review. Instead, this review highlights some of the general aspects of Smad function, and then focuses on the role of specific Smad family members in transcriptional regulation, animal physiology, and disease processes.