A critical process during early heart development is the formation of mesenchymal cells which will contribute to valves and septa of the mature heart. These cells arise by an epithelial-mesenchymal transformation of endothelial cells in the atrioventricular (AV) canal and outflow tract areas of the heart. Adjacent endothelial cells in the atrium and ventricle remain epithelial. A three-dimensional collagen gel culture system has been exploited to examine the interactions that mediate this transformation. The AV canal myocardium produces a stimulus that is transmitted through an intervening extra-cellular matrix to the AV canal endothelium. This interaction is regionally specific, such that ventricular myocardium does not provide an adequate stimulus and ventricular endothelium does not respond to the AV canal myocardial stimulus. Exogenous TGF-β1 (or TGF-β2) can complement ventricular myocardium to produce transformation by AV canal endothelium. A blocking antibody, effective against several TGF-β, prevents cell transformation. To identify the specific member of the TGF-β family that functions in situ, antisense oligonucleotides for each of the numbered TGF-β were topically added to AV canal explant cultures. Only the oligonucleotide targeted to TGF-β3 was an effective inhibitor of mesenchymal cell formation. Studies have been undertaken to localize specific mRNas by in situ hybridization and RNase protection assays. These assays have concentrated on the regional and temporal appearance of TGF-β2 and 3. Surprisingly, RNase protection assays with a TGF-β3 sense probe showed the presence of a transcript complementary to TGF-β3. Further analysis of this tissue interaction included the testing of a variety of signal transduction mechanisms including kinases, G-proteins, and intracellular calcium. Tissue interaction in the heart is a complex interaction in which regulation of the induction process occurs in both the inducing and target tissues. © 1992 Wiley-Liss, Inc.