Signal transduction by the TGF-&bgr; family involves sets of receptor serine/threonine kinases, Smad proteins that act as receptor substrates, and Smad-associated transcription factors that target specific genes. Discrete structural elements were identified that dictate the selective interactions between receptors and Smads and between Smads and transcription factors in the TGF-&bgr; and BMP pathways. A cluster of four residues in the L45 loop of the type I receptor kinase domain, and a matching set of two residues in the L3 loop of the Smad C-terminal domain establish the specificity of receptor-Smad interactions. A cluster of residues in the highly exposed &agr;-helix 2 of the Smad C-terminal domain specify the interaction with the DNA-binding factor Fast1 and, as a result, the gene responses mediated by the pathway. By establishing specific interactions, these determinants keep the TGF-&bgr; and BMP pathways segregated from each other.
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