Previous studies have shown that TGFbeta1 expression is upregulated in mouse keratinocytes infected with a v-rasHa retrovirus, although the functional significance of this has not been clear. Here we show that v-rasHa retrovirus transduced primary mouse keratinocytes undergo hyperproliferation followed by a TGFbeta1 dependent G1 growth arrest and senescence. The growth arrest is accompanied by a 15-fold increase in total TGFbeta1 secreted and a fourfold increase in secreted active TGFbeta1. When cultured in the presence of a neutralizing antibody to TGFbeta1, the senescence response is suppressed. Levels of the TGFbeta1 target p15ink4b increase during senescence as does association of this kinase inhibitor with cyclinD/cdk4 complexes. However, p16ink4a, p53 and p19ARF expression also increase during senescence. Genetic analysis shows that TGFbeta1 null and dominant negative TbetaBRII expressing v-rasHa keratinocytes resist the G1 growth arrest and do not senescence. This resistance is associated with low expression of p15ink4b and p16ink4a, constitutive Rb phosphorylation and high levels of cdk4 and cdk2 kinase activity. In contrast, inactivation of TGFbetabeta1 secretion or response does not block the induction of p53 and p19ARF, but the level of p21waf1, a p53 target gene, is reduced in cyclin D/cdk4 and cyclin E/cdk2 complexes. Thus, although multiple senescence pathways are activated in response to a ras oncogene, inactivation of TGFbeta1 secretion or response is sufficient to block the senescence program. Since v-rasHa transduced TGFbeta1-/- keratinocytes form squamous cell carcinomas following skin grafting, these results suggest that in mouse keratinocytes, defects in TGFbeta1 signaling accelerate malignant progression by overcoming oncogene induced replicative senescence.