When a confluent monolayer of bovine aortic endothelial (BAE) cells is wounded with a razor blade, endothelial cells (ECs) spontaneously move into the denuded area. If bovine pericytes or smooth muscle cells (SMCs) are plated into the denuded area at low density, they block the movement of the ECs. This effect is dependent upon the number of cells plated into the wound area and contact between ECs and the plated cells. Antibodies to transforming growth factor-beta 1 (TGF-beta 1) abrogate the inhibition of BAE cell movement by pericytes or SMCs. TGF-beta 1, if added to wounded BAE cell monolayers, also inhibits cell movement. When cultured separately, BAE cells, pericytes, and SMCs each produce an inactive TGF-beta 1-like molecule which is activated in BAE cell-pericyte or BAE cell-SMC co-cultures. The activation appears to be mediated by plasmin as the inhibitory effect on cell movement in co-cultures of BAE cells and pericytes is blocked by the inclusion of inhibitors of plasmin in the culture medium.