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Disruption of the dystrophin complex causes muscle injury, dysfunction, cell death and fibrosis. Excess transforming growth factor (TGF) β signaling has been described in human muscular dystrophy and animal models, where it is thought to relate to the progressive fibrosis that characterizes dystrophic muscle. We now found that canonical TGFβ signaling acutely increases when dystrophic muscle is stimulated to contract. Muscle lacking the dystrophin-associated protein γ-sarcoglycan (Sgcg null) was subjected to a lengthening protocol to produce maximal muscle injury, which produced rapid accumulation of nuclear phosphorylated SMAD2/3. To test whether reducing SMAD signaling improves muscular dystrophy in mice, we introduced a heterozygous mutation of SMAD4 (S4) into Sgcg mice to reduce but not ablate SMAD4. Sgcg/S4 mice had improved body mass compared with Sgcg mice, which normally show a wasting phenotype similar to human muscular dystrophy patients. Sgcg/S4 mice had improved cardiac function as well as improved twitch and tetanic force in skeletal muscle. Functional enhancement in Sgcg/S4 muscle occurred without a reduction in fibrosis, suggesting that intracellular SMAD4 targets may be important. An assessment of genes differentially expressed in Sgcg muscle focused on those encoding calcium-handling proteins and responsive to TGFβ since this pathway is a target for mediating improvement in muscular dystrophy. These data demonstrate that excessive TGFβ signaling alters cardiac and muscle performance through the intracellular SMAD pathway.