Castration experiments in rodents show that the stromal vasculature is critical to the androgen-mediated prostate growth regulation. However, the role of angiogenesis inhibitors, such as thrombospondin-1 (TSP-1), in this process is unclear. TSP-1 is a multifunctional glycoprotein that can function as a potent angiogenesis inhibitor and an in vivo activator of latent transforming growth factor-beta (TGF-beta) in some tissues. On the basis of these observations, we hypothesized that TSP-1 regulated androgen withdrawal-induced prostate regression and that this process was mediated not only through antiangiogenic activity but also through TGF-beta activation. To test this, we evaluated angiogenic activity in human prostate epithelial and stromal cells treated with androgens and hypoxia in vitro. TSP-1 knockout mice were characterized to investigate the in vivo functions of TSP-1. In vitro, we found that androgens and hypoxia differentially regulated TSP-1 and angiogenic activity. Androgens stimulated normal epithelial cell, but inhibited normal stromal cell, angiogenic activity. Conversely, hypoxia stimulated stromal while inhibiting epithelial activity. Thus, in vivo, net angiogenic activity must reflect cellular interactions. And, we found that media conditioned by epithelial cells grown under normoxic conditions stimulated stromal cell angiogenic activity, and if epithelial cells were grown under hypoxic conditions, stromal activity was further increased. TSP-1 levels, however, were unchanged. In vivo, TSP-1 loss in a mouse model led to prostate epithelial hyperplasia by 3 months of age with only a modest stromal effect. Androgens suppressed TSP-1 as expression increased after castration both in normal mouse prostate and in human prostate cancer tissues. In addition, TSP-1 expression corresponded to increased TGF-beta activation in mouse tissues, specifically in the stromal compartment. These data show a critical role for TSP-1 in prostate epithelial and stromal growth regulation through angiogenic inhibition and activation of latent TGF-beta. Therefore, loss of TSP-1 during tumorigenesis would eliminate two barriers to cancer progression.