The two major intestinal epithelial cell lineages are columnar fluid-absorbing cells and mucin-producing goblet cells. High levels of transforming growth factor (TGF) beta 1 are found surrounding postmitotic cells in the colonic crypt, suggesting that TGF-beta 1 mediates the maturation and growth inhibition of both epithelial cell types. However, we now show that the injection of recombinant TGF-beta 1 into mice leads to an enrichment of goblet cells, indicating that these normal epithelial cells are resistant to TGF-beta 1, In support of this interpretation, each of two independently isolated cell lines modeling normal colon goblet cells was also growth resistant to exogenous TGF-beta 1 but made levels of TGF-beta receptor (T beta R) I, T beta RII, and T beta III mRNA and protein equal to those made by two TGF-beta 1-sensitive cell lines. No mutations were found in the alk5 or alk2 forms of T beta RI or in T beta RII; these receptors were found on the cell surface, although they could not bind I-125-labeled TGF-beta 1. T beta RIII binds TGF-beta 1, concentrates it, and presents it to T beta RII, The major T beta RIII form, betaglycan, did not undergo normal posttranslational modification in either of the goblet cell lines and could not bind I-125-labeled TGF-beta 1; thus, it was nonfunctional, TGF-beta resistance was overcome by raising TGF-beta 1 levels 100-fold, at which point T beta RII could bind TGF-beta 1, Signaling initiated by these higher TGF-beta 1 levels was blocked by the expression of dominant negative T beta RII, demonstrating that T beta RII and T beta RI were functional. Cells resistant to exogenous TGF-beta 1 maintained functional cell surface T beta RI and T beta RII to mediate responses to autocrine TGF-beta 1, which controlled the maturation of the adhesion protein integrin beta(1). Expression of dominant negative T beta RII in goblet cells greatly inhibited the conversion of the beta(1) integrin from its precursor to its mature form. Thus, in normal intestinal epithelial goblet cells, T beta RI and T beta RII can respond to autocrine but not exogenous TGF-beta without the participation of T beta RIII, Absorptive epithelial cells are growth inhibited by TGF-beta 1 both in vivo and in vitro; therefore, the loss of functional T beta RIIIs on goblet cells allows differential regulation of the two major intestinal epithelial cell types.