TGF-β opposes proliferative signaling by IL-2 through mechanisms that remain incompletely defined. In a well-characterized CD8+ T cell model using wild-type and mutated IL-2 receptors, we examined the effects of TGF-β on distinct IL-2 signaling events in CD8+ T cells. IL-2 induces c-myc, cyclin D2, and cyclin E in a redundant manner through the Shc and STAT5 pathways. TGF-β inhibited the ability of either the Shc or STAT5 pathway to induce these genes, as well as T cell proliferation. The inhibitory effects of TGF-β were reversed by expression of a dominant-negative form of Smad3. TGF-β did not impair proximal signaling by Shc or STAT5, and induction of some downstream genes, including cytokine-inducible Src homology-2-containing protein (CIS), bcl-xL, and bcl-2, was spared. Experiments with c-fos, cyclin D2, and CIS reporter genes revealed that promoter-proximal regulatory elements dictate the sensitivity of IL-2 target genes to inhibition by TGF-β. By leaving the Shc and STAT5 pathways functional while inhibiting their target genes selectively, TGF-β was found to uncouple the proliferative and antiapoptotic functions of IL-2. Thus, TGF-β is not a simple antagonist of IL-2, but rather serves to qualitatively modify the IL-2 signal to create a unique pattern of gene expression that neither cytokine can induce independently.