Transforming growth factor-beta (TGF-beta) is one of the most abundant growth factors secreted by bone cells, and regulation of TGF-beta expression is crucial for bone development and growth. Previous studies from our laboratory demonstrated that 1 alpha, 25-dihydroxyvitamin D3 (1 alpha,25(OH)2D3) inhibits human osteoblast and keratinocyte growth by increasing TGF-beta2 secretion and synthesis. To examine the mechanism by which 1 alpha,25(OH)2D3 regulates TGF-beta 2 transcription in osteoblasts, we ligated segments of the human TGF-beta 2 promoter 5' of a growth hormone reporter gene in a growth hormone reporter plasmid and examined the effects of 1 alpha,25(OH)2D3 administration on the expression of growth hormone in cells transfected with such chimeric promoter-reporter plasmids. The promoter region extending from -973 to +68 bp of the transcription start site elicited a 7-fold increase in reporter gene activity in transiently transfected osteoblasts after 1 alpha,25(OH)2D3 treatment, whereas the region from -553 to +68 bp of the transcription start site showed no response following 1 alpha,25(OH)2D3 treatment. Transfection of osteoblasts with reporter plasmids containing TGF-beta 2 promoter DNA from -869 to -658 bp revealed a 3.8-fold increase in reporter gene activity. DNA fragments from this region (-743 to -676 bp and -786 to -728 bp) ligated into reporter plasmids also showed increases in reporter activity. Gel retardation assay experiments showed that DNA fragments from -774 to -735 bp and -714 to -675 bp both formed a DNA-protein complex with bacterially expressed human retinoic acid X receptor alpha (RXR alpha) and vitamin D receptor (VDR) and with nuclear extracts from human bone cells. Addition of a vitamin D receptor antibody to reactions containing the aforesaid DNA fragments and bone cell nuclear extract resulted in further retardation of the mobility of the DNA-protein complex (super-shifting). Removal of two putative direct repeat DNA fragments in this region abolished VDR-RXR alpha-vitamin D response element complex formation. The TGF-beta 2 promoter contains two imperfect direct repeat DNA sequences: TGTAGAACAAGTAGA and AATGAAGTTGGTGGA that mediate the effect of 1 alpha,25(OH)2D3.