This is the first report that characterizes specific inhibitor of Smad3 (SIS3) as a potent and selective inhibitor of Smad3 function. In the reporter assay, the increased luciferase activity of p3TP-lux by the overexpression of constitutively active form of ALK-5 was abrogated by the treatment with SIS3 in a dose-dependent manner. Immunoprecipitation revealed that SIS3 attenuated the transforming growth factor (TGF)-beta1-induced phosphorylation of Smad3 and interaction of Smad3 with Smad4. On the other hand, this reagent did not affect the phosphorylation of Smad2. Thereafter, we evaluated the ability of SIS3 in the suppression of the TGF-beta1-induced type I procollagen up-regulation in human dermal fibroblasts. We found that the addition of SIS3 attenuated the effects of TGF-beta1 by reducing the transcriptional activity. SIS3 also inhibited the myofibroblast differentiation of fibroblasts by TGF-beta1. Moreover, we demonstrated that SIS3 completely diminished the constitutive phosphorylation of Smad3 as well as the up-regulated type I collagen expression in scleroderma fibroblasts. Together, our study suggested that SIS3 is a useful tool to evaluate the TGF-beta-regulated cellular mechanisms via selective inhibition of Smad3.