Transforming growth factor-β1 (TGF-β1) is a multifunctional cytokine involved in differentiation, growth, and survival of mesenchymal cells while inhibiting growth/survival of most other cell types. The mechanism(s) of pro-survival signaling by TGF-β1 in mesenchymal cells is unclear. In this report, we demonstrate that TGF-β1 protects against serum deprivation-induced apoptosis of mesenchymal cells isolated from patients with acute lung injury and of normal human fetal lung fibroblasts (IMR-90). TGF-β receptor(s)-activated signaling in these cells involves rapid activation of the Smad and p38 MAPK pathways within minutes of TGF-β1 treatment followed by a more delayed activation of the pro-survival phosphatidylinositol 3-kinase-protein kinase B (PKB)/Akt pathway. Pharmacological inhibition of p38 MAPK with SB203580 or expression of a p38 kinase-deficient mutant protein inhibits TGF-β1-induced PKB/Akt phosphorylation. Conditioned medium from TGF-β1-treated cells rapidly induces PKB/Akt activation in an SB203580- and suramin-sensitive manner, suggesting p38 MAPK-dependent production of a secreted growth factor that activates this pro-survival pathway by an autocrine/paracrine mechanism. Inhibition of the phosphatidylinositol 3-kinase-PKB/Akt pathway blocks TGF-β1-induced resistance to apoptosis. These results demonstrate the activation of a novel TGF-β1-activated pro-survival/anti-apoptotic signaling pathway in mesenchymal cells/fibroblasts that may explain cell-specific actions of TGF-β1 and provide mechanistic insights into its pro-fibrotic and tumor-promoting effects.