Pituitary tumor development involves clonal expansion stimulated by hormones and growth factors/cytokines. Using mRNA differential display, we found that the bone morphogenetic protein (BMP) inhibitor noggin is down-regulated in prolactinomas from dopamine D2-receptor-deficient mice. BMP-4 is overexpressed in prolactinomas taken from dopamine D2-receptor-deficient female mice, but expression of the highly homologous BMP-2 does not differ in normal pituitary tissue and prolactinomas. BMP-4 is overexpressed in other prolactinoma models, including estradiol-induced rat prolactinomas and human prolactinomas, compared with normal tissue and other pituitary adenoma types (Western blot analysis of 48 tumors). BMP-4 stimulates, and noggin blocks, cell proliferation and the expression of c-Myc in human prolactinomas, whereas BMP-4 has no action in other human pituitary tumors. GH3 cells stably transfected with a dominant negative of Smad4 (Smad4dn; a BMP signal cotransducer) or noggin have reduced tumorigenicity in nude mice. Tumor growth recovered in vivo when the Smad4dn expression was lost, proving that BMP-4/Smad4 are involved in tumor development in vivo. BMP-4 and estrogens act through overlapping intracellular signaling mechanisms on GH3 cell proliferation and c-myc expression: they had additive effects at low concentrations but not at saturating doses, and their action was inhibited by blocking either pathway with the reciprocal antagonist (i.e., BMP-4 with ICI 182780 or 17β-estradiol with Smad4dn). Furthermore, coimmunoprecipitation studies demonstrate that under BMP-4 stimulation Smad4 and Smad1 physically interact with the estrogen receptor. This previously undescribed prolactinoma pathogenesis mechanism may participate in tumorigenicity in other cells where estrogens and the type β transforming growth factor family have important roles.