The three mammalian isoforms of transforming growth factor‐β (TGF‐β1, ‐β2, and ‐β3) are potent regulators of cell growth, differentiation, and extracellular matrix deposition. To study their role in skin carcinogenesis, normal human keratinocytes, early (31) and late (310) passage immortalized keratinocytes (HaCaT cells), and five HaCaT–ras clones exhibiting benign (A‐5, I‐7), malignant (II‐4, A‐5 RT1), and highly aggressive (A‐5 RT3) tumourigenic phenotypes were examined for the expression of TGF‐β isoforms, by immunohistochemistry. This was performed under in vivo conditions, in surface transplants and subcutaneously growing tumours in nude mice. Generally, all tissues that formed keratinized epithelia demonstrated an immunostaining pattern similar to normal human skin. TGF‐β1 was localized to the upper differentiated layers, the stratum granulosum and corneum, in a perimembranous pattern, whereas TGF‐β2 and, weaker, TGF‐β3 immunostaining was present in all suprabasal layers of normal keratinizing epithelia. In contrast, non‐keratinizing transplants of non‐tumourigenic or highly aggressive cells showed little to no immunoreactivity for TGF‐β1. Whereas TGF‐β2 expression was moderate in the upper layers of non‐tumourigenic epithelia, large tumour cells of the malignant HaCaT–ras clones, particularly at the invasion front, were strongly positive for TGF‐β2. TGF‐β3 immunostaining was most pronounced in the stroma of malignant tumours, implying its paracrine induction by the malignant tumour transplants. These results suggest differential functions for each TGF‐β isoform in epidermal carcinogenesis, such that TGF‐β1 is associated with the more differentiated state, TGF‐β2 with highly malignant and invading cells, and TGF‐β3 with tumour stroma formation and angiogenesis. Furthermore, the expression of TGF‐βs by both early‐ and late‐stage tumours implies that the isoforms may have distinct functions at different stages of malignancy, supporting their dual role in skin carcinogenesis. Copyright © 2000 John Wiley & Sons, Ltd.