Ligand-bound receptors of the Transforming Growth Factor-beta (TGF-beta) family promote the formation of complexes between Smad proteins that subsequently accumulate in the nucleus and interact there with other transcriptional regulators, leading to modulation of target gene expression. We identified a novel nuclear protein, Smicl, which binds to Smad proteins. Smicl and Smads cooperate and enhance TGF-beta mediated activation of a Smad-responsive reporter gene. A domain with five CCCH-type zinc fingers in Smicl is structurally and functionally, at least in vitro, similar to a domain in CPSF-30, the 30 kDa subunit of Cleavage and Polyadenylation Specificity Factor (CPSF). Like CPSF-30, Smicl can associate with some other CPSF subunits characterized previously. Its effect on the induction of a reporter gene for TGF-beta requires the cleavage/polyadenylation signal downstream of the coding sequence of that gene. Thus, Smicl is a novel protein that displays CPSF-30-like activities, interacts in the nucleus with activated Smads, and potentiates in TGF-beta stimulated cells Smad-dependent transcriptional responses, possibly in conjunction with the activity of CPSF complexes.