In adult tissue, vascular smooth muscle cells (VSMCs) exist in a differentiated phenotype, which is defined by the expression of contractile proteins and lack of proliferation. After vascular injury, VSMC adopt a synthetic phenotype associated with proliferation, migration and matrix secretion. The transition between phenotypes is a consequence of the extracellular environment, and in particular, is regulated by agonists such as the pro-differentiating cytokine transforming growth factor β (TGFβ) and the pro-proliferative cytokine platelet derived growth factor (PDGF). In this study, we investigated the interplay between TGFβ and PDGF with respect to their ability to regulate VSMC proliferation. Stimulation of human aortic VSMC with TGFβ completely blocked proliferation induced by all isoforms of PDGF, as measured by DNA synthesis and total cell number. Mechanistically, PDGF-induced Cyclin D1 mRNA and protein expression was inhibited by TGFβ. TGFβ had no effect on PDGF activation of its receptor and ERK1/2, but inhibited Akt activation. However, constitutively active Akt did not reverse the inhibitory effect of TGFβ on Cyclin D1 expression even though inhibition of the proteasome blocked the effect of TGFβ. siRNA against Smad4 completely reversed the inhibitory effect of TGFβ on PDGF-induced Cyclin D1 expression and restored proliferation in response to PDGF. Moreover, siRNA against KLF5 prevented Cyclin D1 upregulation by PDGF and overexpression of KLF5 partially reversed TGFβ-induced inhibition of Cyclin D1 expression. Taken together, our results demonstrate that KLF5 is required for PDGF-induced Cyclin D1 expression, which is inhibited by TGFβ via a Smad dependent mechanism, resulting in arrest of VSMCs in the G1 phase of the cell cycle.