TGFβ-related growth factors have been implicated in a variety of developmental and physiological processes in organisms ranging from nematodes to mammals. TGFβ transduces its signal to the interior of the cell via Smad2, Smad3, and Smad4. We report the cloning and targeted disruption of the mouse Smad3 gene. Smad3 mutant mice are viable and fertile. Between 4 and 6 months of age, the Smad3 mutant mice become moribund with colorectal adenocarcinomas. The neoplasms penetrate through the intestinal wall and metastasize to lymph nodes. These results directly implicate TGFβ signaling in the pathogenesis of colorectal cancer and provide a compelling animal model for the study of human colorectal cancer.