of Bmper and Bmp4 and significant involvement of surface Bmp receptors in mediating endocytic sorting of Bmper and Bmp4 to the lysosome to limit the temporal boundaries of Smad activation. The inhibitory activity of Bmper is supported by our in vivo evidence that Bmper behaves as a tissue-specific Bmp inhibitor in the developing lung of Bmper-deficient mice. The deletion of Bmper affects the distal area of the lung where Bmper is expressed in the mesenchyme, but not the proximal area where both Calcitonin gene-related peptide and Clara cells are located. These results strongly support the interpretation that the phenotype in Bmper +/ lungs is caused by local defi- ciency of Bmper and not by a nonspecific secondary effect of delayed lung development. The physiological anti-Bmp activity of Bmper during lung development is completely consistent with our in vitro evidence that Bmper leads to apoptosis of em- bryonic interstitial lung MEFs, which is normally inhibited by Bmp signaling. Whether Bmper exerts pro- or anti-Bmp activ- ities in vivo in different models may be tissue and possibly spe- cies specific and tissue differences in the ratios of Bmper to Bmp family members likely determine whether Bmper is aug- menting or suppressing Bmp signaling. Collectively with previous biochemical and genetic stud- ies (Coles et al., 2004; Rentzsch et al., 2006; Zhang et al., 2007; Serpe et al., 2008), a model can be developed that parsimoni- ously accounts for seemingly disparate observations (Fig. 8 d). At low molar concentrations, Bmper may bind Bmp4 in a man- ner that increases the affinity of Bmp4 for its receptors (Zhang et al., 2007), accounting for the activation of Bmp signaling that we observe under these conditions (Fig. 6 a). A recent study suggests that this occurs through a Bmp, Bmper, and Bmp re- ceptor tripartite complex that facilitates transfer of Bmp to the Bmp receptor to account for this activity (Serpe et al., 2008). As Bmper exceeds the molar concentration of Bmp4, high affinity Bmp4 receptor binding determinants may be masked, resulting in a low affinity receptor interaction, but in any event endo- cytosis of both Bmp4 and Bmper is clearly triggered under these circumstances in a receptor-dependent fashion. The uncleaved form of Bmper was previously suggested to exert its anti-Bmp activity through association with components of the extra- cellular matrix and cell membrane (Rentzsch et al., 2006), but the present studies make clear that the uncleaved form of Bmper also enhances Bmp4 endocytosis, facilitating a Bmp4 sink through recruitment of Bmps to the cell surface. Furthermore, although the N terminus of Bmper binds Bmp4, the C terminus of Bmper is required for this endocytic mechanism; our results and those of other groups lead us to speculate that the C termi- nus of Bmper may facilitate endocytosis through interactions with the extracellular matrix and/or Bmp receptors. Under cer- tain conditions, the function of trapping Bmps by Bmper can be uncoupled from an intracellular Bmp sink, and therefore endo- cytosis is not essential to the inhibitory activity of Bmper. The ability of not only Bmper but also Gremlin and Noggin to trig- ger the endocytosis of Bmp4 suggests that this is a broadly ap- plied mechanism by inhibitors of Bmp signaling to regulate the concentration and temporal availability of Bmps as a signal reg- ulation strategy. Materials and methods Antibodies and reagents The antibodies and recombinant proteins for Bmper, Bmp4, Noggin, Chor- din, and Gremlin and monoclonal anti-human Bmp4 neutralizing antibody were purchased from R&D Systems. Phosphorylated Smad and cleaved Caspase 3 antibodies were purchased from Cell Signaling Technology. QuikChange site-directed mutagenesis (Agilent Technologies) was used to modify a previously described pSecTag2 vector containing wild-type Bmper (Moser et al., 2003). W.C. Sessa (Yale University School of Medicine, New Haven, CT) provided the lung endothelial cells for caveolin-1. Preembedding immunoelectron microscopy MECs were ﬁxed with 4% paraformaldehyde/0.5% glutaraldehyde. After three washes in 0.15 M sodium phosphate buffer the cells were immuno- stained using a preembedding immunogold-silver procedure developed by Yi et al. (2001). 70-nm ultrathin sections were cut using a diamond knife and an Ultracut UCT microtome (Leica), mounted on 200 mesh copper grids and post-stained with Reynolds’ lead citrate for 8 min. Sections were exam- ined on a transmission electron microscope (EM-910; Carl Zeiss, Inc.) using an acceleration voltage of 80 kV and a 75-μm objective aperture. Digital micrographs were taken using an Orius digital camera (Gatan, Inc.). Cell culture MEFs were isolated from mouse lung at embryonic day 15.5 from wild- type mice of a mixed background (C57BL/6 and Ola 129). In brief, em- bryos were dissected from the mother’s uterus and placed in sterile PBS in a 10-cm dish. The embryos were separated from fetal membranes (in the case of lung MEFs, lung lobes were separated from the heart and neigh- boring connective tissue) and placed in 1 ml of 0.25% trypsin-EDTA and a sterile razor blade was used to mince the embryos. The minced embryos were allowed to sit in the trypsin-EDTA for 10 min at 37°C and 5% CO2 followed by neutralization in 2 ml of growth media (DME, 10% FCS, and penicillin and streptomycin with 50 μM -mercaptoethanol). After repeat- edly pipetting and disaggregating the tissue, 8 ml of growth media was added to the plates to seed the ﬁbroblasts. On day 2, the 10-cm plates were conﬂuent and cells in suspension were removed. The cells were passed once and then used for experimentation. MECs were cultured as previously described (Moser et al., 2003; Ren et al., 2007) and human coronary arterial endothelial cells (HCAECs; Lonza) were cultured accord- ing to the manufacturer’s recommendation using EGM-2 media (Lonza). Unless otherwise indicated, cultured cells were treated with recom- binant Bmp4 (0.6 nM) and/or recombinant Bmper, Chordin, Noggin, and/or Gremlin (6.0 nM) in high glucose DME for various times to ana- lyze the temporal effects of Bmper toward Bmp4 activity and internaliza- tion. For chase experiments, cells were pulsed with recombinant proteins and then chased with “cold” or normal DME media or media containing chloroquine for the indicated times. Active internalization was deter- mined in cells cultured normally at 37°C versus pretreating the cells at 4°C for 45 min before treating them with recombinant proteins for up to 60 min at 4°C. Conditioned media were harvested after 48 h of trans- fecting HEK-293 cells using FuGENE and cDNA from wild-type Bmper or Bmper mutants. Undiluted condition media were applied to MECs, and recombinant proteins used in the mutant studies were diluted in control (untransfected) HEK-293 condition media as positive controls for internal- ization and Bmp signaling. Subcellular localization Immunolocalization was performed on untreated and treated MECs and HCAECs, ﬁxed with 4% paraformaldehyde, permeabilized with 0.1% Tri- ton X-100, blocked with 1% BSA in PBS, and incubated with primary anti- bodies, followed by incubation with Alexa Fluor secondary antibodies. Digital pictures were taken using an upright laser scanning confocal micro- scope (SP2 AOBS; Leica) at room temperature (at the University of North Carolina’s Michael Hooker Microscopy Facility). Images were processed using LCS Lite imaging software (Leica) and Photoshop (Adobe). Western blotting analysis Western analysis was performed on MECs treated with recombinant pro- teins (all purchased from R&D Systems). In brief, blotting was performed by incubating primary antibodies (anti-Bmper [R&D Systems], anti-Bmp4 [Mil- lipore], anti-Chordin, anti-Gremlin, and anti-Noggin [R&D Systems]). Blots were developed with an Advanced ECL kit (Thermo Fisher Scientiﬁc). Immunoprecipitation was performed using an anti-Myc antibody (Santa Cruz Biotechnology, Inc.). ENDOCYTIC REGULATION OF BMP SIGNALING BY BMPER • Kelley et al. 607