Lysyl oxidase (LOX), an amine oxidase critical for the initiation of collagen and elastin cross-linking, has recently been shown to regulate cellular activities possibly by modulating the functions of growth factors. In this study, we investigated the interaction between LOX and transforming growth factor-beta1 (TGF-beta1), a potent growth factor abundant in bone, the effect of LOX on TGF-beta1 signaling, and its potential mechanism. The specific binding between mature LOX and mature TGF-beta1 was demonstrated by immunoprecipitation and glutathione S-transferase pulldown assay in vitro. Both proteins were colocalized in the extracellular matrix in an osteoblastic cell culture system, and the binding complex was identified in the mineral-associated fraction of bone matrix. Furthermore, LOX suppressed TGF-beta1-induced Smad3 phosphorylation likely through its amine oxidase activity. The data indicate that LOX binds to mature TGF-beta1 and enzymatically regulates its signaling in bone and thus may play an important role in bone maintenance and remodeling.