Objective. We have previously shown that interleukin-1 beta (IL-1 beta) impairs transforming growth factor beta (TGF beta) signaling through TGF beta receptor type II (TGF beta RII) down-regulation and Smad7 up-regulation. This mechanism could account for the reduced responsiveness of osteoarthritic chondrocytes to TGF beta and the cartilage breakdown linked to this disease. The aim of this study was to investigate the molecular mechanism underlying the IL-1 beta-induced stimulation of Smad7 in human articular chondrocytes. Methods. Human articular chondrocytes were treated with IL-1 beta in the presence of TGF beta 1, pyrrolidine dithiocarbamate (a repressor of the NF-kappa B pathway), or cycloheximide. Then, steady-state messenger RNA and protein levels were estimated by real-time reverse transcription-polymerase chain reaction and immunocytology. In addition, transient transfections of p65 expression vector or p65-targeted short hairpin RNA were performed to define the effect of NF-kappa B on Smad7 expression. Results. TGF beta RII overexpression restored the TGF beta response of human articular chondrocytes. However, this effect was transient, implying that a secondary mechanism was responsible for the alteration of the TGF beta response with long-term exposure to IL-1 beta. Moreover, IL-1 beta caused a late induction of the inhibitory Smad7. This effect was direct, since it did not require de novo synthesis. In addition, we established, by experiments with gain/loss of function, that the up-regulation of Smad7 by IL-1 beta is mediated through the NF-kappa B pathway, especially the p65 subunit. Conclusion. These findings clarify the regulatory process of IL-1 beta on Smad7 expression. Understanding the molecular basis of IL-1 beta induction of Smad7 and the reduction of chondrocyte responsiveness to TGF beta provides new insights into the molecular mechanisms of osteoarthritis and may facilitate the identification of novel approaches for its treatment.