TGF-beta activates receptor-regulated Smad (R-Smad) through phosphorylation by type I receptors. Activated R-Smad binds to Smad4 and the complex translocates into the nucleus and stimulates the transcription of target genes through association with co-activators including p300. It is not clear, however, how activated Smad complexes are removed from target genes. In this study, we show that TGF-beta enhances the mono-ubiquitination of Smad4. Smad4 mono-ubiquitination was promoted by p300 and suppressed by the c-Ski co-repressor. Smad4 mono-ubiquitination disrupted the interaction with Smad2 in the presence of constitutively active TGF-beta type I receptor. Furthermore, mono-ubiquitinated Smad4 was not found in DNA-binding Smad complexes. A Smad4-Ubiquitin fusion protein, which mimics mono-ubiquitinated Smad4, enhanced localization to the cytoplasm. These results suggest that mono-ubiquitination of Smad4 occurs in the transcriptional activator complex and facilitates the turnover of Smad complexes at target genes.