Previous studies of pulmonary arterial hypertension (PAH) have implicated excessive transforming growth factor (TGF)-β₁ signaling and reduced bone morphogenetic protein (BMP) signaling in the disease pathogenesis. Reduced BMP signaling in pulmonary artery smooth muscle cells (PASMCs) from patients with heritable PAH is a consequence of germline mutations in the BMP type II receptor (BMPR-II). We sought to establish whether the TGF-β₁ and BMP4 pathways interact in PASMCs, and if this is altered in cells with BMPR-II mutations. Control PASMCs or from patients with PAH harboring BMPR-II mutations were treated with BMP4, TGF-β₁, or cotreated with both ligands. Signaling was assessed by examination of Smad phosphorylation, luciferase reporters, and the transcription of BMP4 or TGF-β₁–responsive genes. TGF-β₁ attenuated BMP4-mediated inhibitors of differentiation 1/2 induction and abolished the response in BMPR-II mutant PASMCs, whereas BMP4 did not alter TGF-β₁–mediated transcription. Activin-like kinase 5 inhibition blocked this effect, whereas cycloheximide or pharmacological inhibitors of TGF-β–activated kinase 1, extracellular signal–regulated kinase 1/2, or p38 mitogen-activated protein kinase were ineffective. BMP4 and TGF-β₁ cotreatment did not alter the activation or nuclear translocation of their respective Smad signaling proteins. Small interfering RNA for Smad3, but not Smad2, Smad6, or Smad7, reversed the inhibition by TGF-β₁. In addition, TGF-β–activated kinase 1 inhibition blocked Smad3 phosphorylation, implying that C-terminal Smad3 phosphorylation is not required for the inhibition of BMP4 signaling by TGF-β₁. TGF-β₁ reduces BMP4 signaling in PASMCs, a response that is exacerbated on the background of reduced BMP responsiveness due to BMPR-II mutations. These data provide a rationale for therapeutic inhibition of TGF-β₁ signaling in PAH.