The inducible isoform of nitric-oxide synthase (NOS2) catalyzes the production of nitric oxide (NO), which participates in the pathophysiology of systemic inflammatory diseases such as sepsis. NOS2 is transcriptionally up-regulated by endotoxin and inflammatory cytokines, and down-regulated by transforming growth factor (TGF)-beta1. Recently we have shown that high mobility group (HMG)-I(Y) protein, an architectural transcription factor, contributes to NOS2 gene transactivation by inflammatory mediators. The aim of the present study was to determine whether regulation of HMG-I(Y) by TGF-beta1 contributes to the TGF-beta1-mediated suppression of NOS2. By Northern blot analysis, we show that TGF-beta1 decreased cytokine-induced HMG-I(Y) mRNA levels in vascular smooth muscle cells and macrophages in vitro and in vivo. Western analysis confirmed the down-regulation of HMG-I(Y) protein by TGF-beta1. To determine whether the down-regulation of HMG-I(Y) contributed to a decrease in NOS2 gene transactivation by TGF-beta1, we performed cotransfection experiments. Overexpression of HMG-I(Y) was able to restore cytokine inducibility of the NOS2 promoter that was suppressed by TGF-beta1. The effect of TGF-beta1 on NOS2 gene transactivation was not related to a decrease in binding of HMG-I(Y) to the promoter of the NOS2 gene, but due to a decrease in endogenous HMG-I(Y) protein. These data provide the first evidence that cytokine-induced HMG-I(Y) can be down-regulated by TGF-beta1. This down-regulation of HMG-I(Y) contributes to the TGF-beta1-mediated decrease in NOS2 gene transactivation by proinflammatory stimuli.