Human formyl peptide receptor-like 1 and its mouse homologue formyl peptide receptor 2 (FPR2) are G protein-coupled receptors used by a number of exogenous and host-derived chemotactic peptides, including the 42 aa form of beta amyloid peptide, a causative factor of Alzheimer's disease. Functional FPR2 was induced by bacterial LPS in murine microglial cells, the resident phagocytic cells that play a pivotal role in inflammatory and immunological diseases in the CNS. To identify agents that may suppress microglial cell activation under proinflammatory conditions, we investigated the effect of TGF-beta1 on the expression of functional FPR2 by microglial cells activated by LPS. TGF-beta1 dose-dependently inhibited the mRNA expression and function of FPR2 in LPS-activated microglial cells. The inhibitory effect of TGF-beta1 was mediated by Smad3, a key signaling molecule coupled to the TGF-beta receptor, and the transcription coactivator, p300. Also, TGF-beta1 activates MAPKs in microglial cells that became refractory to further stimulation by LPS. These effects of TGF-beta1 culminate in the inhibition of LPS-induced activation of NF-kappaB and the up-regulation of FPR2 in microglial cells. Thus, TGF-beta1 may exert a protective role in CNS diseases characterized by microglial cell activation by proinflammatory stimulants.