The bone morphogenetic protein (BMP) signaling pathways have important roles in embryonic development and cellular homeostasis, with aberrant BMP signaling resulting in a broad spectrum of human disease. We report that BMPs unexpectedly signal through the canonical transforming growth factor β (TGF-β)-responsive Smad2 and Smad3. BMP-induced Smad2/3 signaling occurs preferentially in embryonic cells and transformed cells. BMPs signal to Smad2/3 by stimulating complex formation between the BMP-binding TGF-β superfamily receptors, activin receptor-like kinase (ALK)3/6, and the Smad2/3 phosphorylating receptors ALK5/7. BMP signaling through Smad2 mediates, in part, dorsoventral axis patterning in zebrafish embryos, whereas BMP signaling through Smad3 facilitates cancer cell invasion. Consistent with increased BMP-mediated Smad2/3 signaling during cancer progression, Smad1/5 and Smad 2/3 signaling converge in human cancer specimens. Thus, the signaling mechanisms used by BMPs and TGF-β superfamily receptors are broader than previously appreciated.