MAN1 (also known as LEMD3) is an integral protein of the inner nuclear membrane. Recently, mutations in MAN1 have been shown to result in osteopoikilosis, Buschke-Ollendorff syndrome and melorheostosis. We show that the nucleoplasmic, C-terminal domain of human MAN1 binds to Smad2 and Smad3 and antagonizes signaling by transforming growth factor-beta (TGF-beta). In a yeast two-hybrid screen using the C-terminal domain of MAN1 as bait, eight positive clones were obtained that encoded Smad3. In direct two-hybrid assays, this portion of MAN1 bound to Smad2 and Smad3. In glutathione-S-transferase precipitation assays, the C-terminal domain of MAN1 bound to Smad2 and Smad3 under stringent conditions. Antibodies against MAN1 were able to co-immunoprecipiate Smad2 from cells, demonstrating that they reside in the same complex in vivo. TGF-beta treatment stimulated transcription from a reporter gene in control cells, but reporter gene stimulation was significantly inhibited in cells overexpressing MAN1 or its C-terminal domain but not its N-terminal domain. TGF-beta-induced cell proliferation arrest was also inhibited in stable cell lines overexpressing MAN1. These results show that the nuclear envelope regulates a signal transduction pathway and have implications for how mutations in nuclear envelope proteins cause different human diseases.