We have previously reported that keratinocytes defective in glycosylphosphatidylinositol (GPI)-anchor biosynthesis display enhanced TGF- responses. These studies implicated the involvement of a 150 kDa GPI-anchored TGF-1 binding protein, r150, in modulating TGF- signaling. Here, we sought to determine the molecular identity of r150 by affinity purification and microsequencing. Our results identify r150 as CD109, a novel member of the 2-macroglobulin (2M)/complement superfamily, whose function has remained obscure. In addition, we have identified a novel CD109 isoform that occurs in the human placenta but not keratinocytes. Biochemical studies show that r150 contains an internal thioester bond, a defining feature of the 2M/complement family. Loss and gain of function studies demonstrate that CD109 is a component of the TGF- receptor system, and a negative modulator of TGF- responses in keratinocytes, as implicated for r150. Our data suggest that CD109 can inhibit TGF- signaling independently of ligand sequestration and may exert its effect on TGF- signaling by direct modulation of receptor activity. Together, our results linking CD109 function to regulation of TGF- signaling suggest that CD109 plays a unique role in the regulation of isoform-specific TGF- signaling in keratinocytes.--Finnson, K. W., Tam, B. Y. Y., Liu, K., Marcoux, A., Lepage, P., Roy, S., Bizet, A. A., Philip, A. Identification of CD109 as a TGF-1 accessory receptor in human keratinocytes.