Transforming growth factor-beta (TGF-beta) delivers diverse growth and differentiation signals by binding two distantly related transmembrane serine/threonine kinase receptors: the type I receptor (TbetaRI) and the type II receptor (TbetaRII). In an attempt to establish the role of the transmembrane domain in receptor signaling, two chimeric TGF-beta receptors, TbetaRI-II-I and TbetaRII-I-II, containing the opposite transmembrane domain were generated. When transfected into a mutant mink lung epithelial cell line R1B, which lacks functional TbetaRI, TbetaRI-II-I restored TGF-beta1-induced transcriptional activation of a TGF-beta reporter p3TP-Lux to approximately 25% of the levels restored by wild-type TbetaRI. In the mutant mink lung epithelial cell line DR26, which contains a truncated, nonfunctional TbetaRII, wild-type receptor TbetaRII restored the TGF-beta responsiveness, while the TbetaRII-I-II cDNA was inactive. When both TbetaRI and TbetaRII were transfected into R1B, DR26, or Mv1Lu cells, a low level of constitutive p3TP-Lux activity was observed. However, cotransfection of both transmembrane chimeric receptors, TbetaRI-II-I and TbetaRII-I-II, or the wild-type TbetaRI with the transmembrane chimeric TbetaRII-I-II resulted in high levels of ligand-independent receptor activation. These results suggest that the transmembrane domains of both TGF-beta receptors are essential and play a pivotal role in receptor activation. To investigate the role of the transmembrane domain further, four type II transmembrane mutants were generated: TbetaRIIDelta-1, TbetaRIIDelta-2, TbetaRIIDelta-3, and TbetaRIIDelta-4, which have one, two, three, or four amino acids deleted at the N terminus of the transmembrane domain, respectively. Interestingly, co-expression of TbetaRIIDelta-1 with the wild-type TbetaRI in DR26 cells resulted in high levels of constitutive activation, while only low levels of the activation were observed when TbetaRIIDelta-2, TbetaRIIDelta-3, or TbetaRIIDelta-4 were co-expressed with the wild-type TbetaRI. However, TbetaRIIDelta-1 restored very little the TGF-beta responsiveness in DR26cells. Expression of TbetaRIIDelta-2, TbetaRIIDelta-3, and TbetaRIIDelta-4 resulted in a progressive increase in TGF-beta responsiveness, with TbetaRIIDelta-4 reaching the level of activity of the wild-type TbetaRII. Furthermore, like TbetaRII-I-II, co-expression of TbetaRIIDelta-1 with TbetaRI-II-I also resulted in high levels of constitutive activation. These results are consistent with an important role for the transmembrane region of the receptors. We further propose a model of receptor activation in which receptor activation occurs via relative orientational rotation.