Cited (CBP/p300-interacting transactivators with glutamic acid (E)/aspartic acid (D)-rich C-terminal domain) 2, which is a CBP/p300-binding transcription co-activator without typical DNA-binding domains, has been implicated in control of cell growth and malignant transformation in Rat1 cells. In this report, we provide evidence that Cited2 is an important regulator of transforming growth factor (TGF)-beta signaling. Overexpression of Cited2 enhanced TGF-beta-mediated transcription of a Smad-Binding Element-containing luciferase reporter construct, SBE4-Luc. This may occur through a direct physical association of Cited2 with Smads 2 and 3, as supported by co-immunoprecipitation, mammalian two-hybrid and glutathione S-transferase-pull down assays. The transcription factor p300, which binds to Smad3, was shown to further enhance the interaction between Cited2 and Smad3, and the transcriptional responses of Smad3 by Cited2 in reporter assays. Cited2 enhances TGF-beta-mediated upregulation of matrix metalloproteinase 9 (MMP9) in Cited2 inducible mouse embryo fibroblasts. Overexpression of Cited2 enhanced TGF-beta-mediated MMP9 promoter reporter activity. Moreover, knockdown of Cited2 in MDA-MB-231 cells attenuated TGF-beta-mediated upregulation of MMP9 and TGF-beta-mediated cell invasion. Chromatin immunoprecipitation showed that Cited2 and Smad3 were recruited to MMP9 promoter upon TGF-beta stimulation. This is the first demonstration that Cited2 functions as a Smad3/p300-interacting transcriptional co-activator in modulating the expression of MMP9, which could affect tumor cell invasion mediated by TGF-beta.