In this study we have attached cyclic targeting peptides by way of a poly-lysine spacer on the surface of an adenovirus using a transglutaminase enzymatic reaction to enhance transduction efficiency and to modify tissue tropism in vivo. Nuclear targeted lacZ- and TIMP-1-encoding adenoviruses were coupled to a peptide-motif (HWGF) that can bind to matrix metalloproteinase (MMP)-2 and MMP-9. Modified viruses were used to evaluate gene transfer efficiency, biodistribution, and the effect on neointima formation following balloon denudation injury. In vitro, both rabbit aortic smooth muscle cells and human endothelial hybridoma cells demonstrated significantly increased reporter gene expression with HWGF-modified adenoviruses (AdlacZ(HWGF)) compared with control (AdlacZ) or mismatch peptide-modified (AdlacZ(MM)) adenoviruses. However, in human hepatocellular Hep-G2 cells, both AdlacZ(HWGF) and AdlacZ(MM) produced significantly lower transgene expression compared with the respective control viruses. In vivo, local intravascular catheter-mediated gene transfer of a HWGF-targeted TIMP-1-encoding adenovirus (AdTIMP-1(HWGF)) significantly reduced intimal thickening in a rabbit aortic balloon denudation model (P < 0.05) compared with the control adenovirus. X-Gal staining and biodistribution analyses with TaqMan RT-PCR revealed that the cyclic peptides altered vector tropism and, in particular, reduced transduction of the liver. We found that the HWGF peptide modification increased transduction efficiency of the adenovirus-mediated gene transfer in smooth muscle cells and endothelial cells in in vitro and enhanced gene transfer to the arterial wall in vivo; that peptide modification of adenoviruses beneficially modulated tissue tropism in vivo; and that efficient TIMP-1 gene transfer reduced intimal thickening in an established restenosis model in rabbits.