The interplay between the transforming growth factor ? (TGF-?) signaling proteins, SMAD family member 2 (SMAD2) and 3 (SMAD3), and the TGF-?-inhibiting SMAD, SMAD7, seems to play a vital role in proper pancreatic endocrine development and also in normal ?-cell function in adult pancreatic islets. Here, we generated conditional SMAD7 knockout mice by crossing insulin1Cre mice with SMAD7fx/fx mice. We also created a ? cell-specific SMAD7-overexpressing mouse line by crossing insulin1Dre mice with HPRT-SMAD7/RosaGFP mice. We analyzed ?-cell function in adult islets when SMAD7 was either absent or overexpressed in ? cells. Loss of SMAD7 in ? cells inhibited proliferation, and SMAD7 overexpression enhanced cell proliferation. However, alterations in basic glucose homeostasis were not detectable following either SMAD7 deletion or overexpression in ? cells. Our results show that both the absence and overexpression of SMAD7 affect TGF-? signaling and modulates ?-cell proliferation but does not appear to alter ?-cell function. Reversible SMAD7 overexpression may represent an attractive therapeutic option to enhance ?-cell proliferation without negative effects on ?-cell function.