The human tumor cell line HT-1080 was used as a model system to study the effects of transforming growth factor-beta (TGF beta) on polypeptide synthesis and proteolytic activity of malignant cells. Confluent cultures were exposed to TGF beta under serum-free conditions, and alterations in the production of proteins were examined by metabolic labeling and polypeptide analysis. TGF beta induced the synthesis and secretion of the Mr 47,000 endothelial type plasminogen activator inhibitor (PAI-1) as shown by reverse zymography, immunblotting, and immunoprecipitation analyses. TGF beta-induced PAI-1 was rapidly deposited in the growth substratum of the cells as shown by metabolic labeling and extraction of the cultures with sodium deoxycholate. Using pulse-chase experiments, we found a relatively fast turnover of substratum-associated PAI-1. Exogenously added urokinase released PAI-1 from the substratum even in the presence of the plasmin inhibitor aprotinin, suggesting a direct effect of urokinase. Immunoreactive complexes of higher molecular weight were subsequently detected in the medium. Epidermal growth factor, transforming growth factor-alpha, platelet-derived growth factor, and insulin did not elicit similar effects on the amount of PAI-1. TGF beta also inhibited the anchorage-independent growth of HT-1080 cells at the same concentrations at which it induced PAI-1. These results indicate that TGF beta can modulate the extracellular proteolytic activity of cultured cells by enhancing the secretion and deposition of PAI-1 into their microenvironment. It remains to be established whether TGF beta inhibition of anchorage-independent growth of these cells is associated with the induction of PAI-1.