We have shown previously that recombinant myostatin protein (R-Mst) inhibits myogenesis and promotes adipogenesis in C3H 10T (1/2) mesenchymal multipotent cells. In this study we show that myostatin effects in this cell line are mediated through the Smad signaling transduction pathway and some of their downstream components. C3H 10 T (1/2) cells were incubated with 5′-azacytidine to induce differentiation and then treated with 4 μg/mL of R-Mst in a time course manner (0.5, 2, 3, 24 hs and 3 days), using TGF-β (10 ng/mL) as a positive control. Transcriptional regulation of the Smad signaling components was evaluated by a pathway focus designed microarray which has ≈100 genes related to the TGFβ-BMP signaling pathway and by immunocytochemistry (IC) for p-Smad 2/3, 3, 4, and 7. Total RNA from cells treated with R-Mst for 3 Hs and 3 days was analyzed by microarray. In parallel, cells were fixed with paraformaldehyde and analyzed by IC. The main results of the microarray analysis at 3 hs showed that Smad 3, TGFβ1, activins (Inhbb, Ebaf), and Grem1 (signaling regulator molecule) were up-regulated, whereas activin response (Tgif), GDF6, activin (Inhbe), regulator molecule (LAP3), BMP-responsive Smad target genes (Sox4, Dlx2), TGFβ2, and Fst (follistatin), an inhibitor of myostatin activity, were down-regulated, and Smad 1, 2, 5, 6, and -7 did not change. After 3 days of incubation with R-Mst: GDF2 was up-regulated, while Smad target genes (Bambi, DLX2, Cdc25a, Eng, Fos), GDF1, -3, -8, -9, BMP responsive (Idb1), the activin Inhbe, BMP5 and LAP3 were down-regulated, and Fst (folistatin) and Smad 1, 2, 5, 7 remained the same while Smad 3 was undetectable. The results for p-Smad 2/3, 3, 4, and 7 were confirmed by IC, and the results from the microarrays were confirmed by quantitative RT-PCR. In conclusion, myostatin inhibits myogenesis and promotes adipogenesis in C3H 10 T (1/2) cells by signaling through the Smad signaling pathway in an early response since R-Smad 3 (not 2) mRNA and p-Smad 2/3 protein were expressed at 30 min and disappeared thereafter, followed by the subsequent induction of the Smad inhibitor, Smad 7 (not 6) and of downstream Smad-mediated genes.