Atrial natriuretic peptide (ANP) and transforming growth factor (TGF)- play important counterregulatory roles in pulmonary vascular adaptation to chronic hypoxia. To define the molecular mechanism of this important interaction, we tested whether ANP-cGMP-PKG signaling inhibits TGF-1-induced extracellular matrix (ECM) expression and defined the specific site(s) at which this molecular merging of signaling pathways occurs. Rat pulmonary arterial smooth muscle cells (PASMCs) were treated with ANP (1 µM) or cGMP (1 mM) with or without pretreatment with the PKG inhibitors KT5823 (1 µM) or Rp-8-Br-cGMP (50 µM), then exposed to TGF-1 (1 ng/ml) for 5-360 min (for pSmad nuclear translocation and protein analysis) or 24 hrs (for ECM mRNA expression). Nuclear translocation of pSmad2 and pSmad3 was assessed by fluorescent confocal microscopy. ANP and cGMP inhibited TGF-1-induced pSmad2 and pSmad3 nuclear translocation and expression of periostin (PN), osteopontin (OPN) and plasminogen activator inhibitor (PAI)-1 mRNA and protein, but not TGF-1-induced phosphorylation of Smad2 and Smad3. KT5823 and Rp-8-Br-cGMP blocked ANP/cGMP-induced activation of PKG and inhibition of TGF-1-stimulated nuclear translocation of pSmad2 and pSmad3 in PASMCs. These results reveal for the first time a precise site at which ANP-cGMP-PKG signaling exerts its anti-fibrogenic effect on the pro-fibrogenic TGF-1 signaling pathway: by blocking TGF-1-induced pSmad2 and pSmad3 nuclear translocation and ECM expression in PASMCs. Blocking nuclear translocation and subsequent binding of pSmad2 and pSmad3 to TGF--Smad response elements in ECM genes may be responsible for the inhibitory effects of ANP on TGF--induced expression of ECM molecules.