Transforming growth factor-beta1 (TGFbeta1) is a multipotent cytokine that is involved in the regulation of vasculogenesis and angiogenesis. However, the actions of TGFbeta1 on vascular cells in vitro and in vivo are extremely complex and still incompletely understood. The aim of the present study was to investigate the role of TGFbeta1 and its two type I receptors, activin receptor-like kinase-1 (ALK1) and ALK5, in an embryonic stem cell (ESC) differentiation model that recapitulates the developmental steps of vasculogenesis and sprouting angiogenesis. We show that TGFbeta1 increases endothelial cell differentiation in a vascular endothelial growth factor (VEGF)-independent manner and inhibits endothelial tube formation. Furthermore, we demonstrate that undifferentiated ESCs express ALK5 but do not express ALK1, with ALK1 being expressed only after day 5 of differentiation. Finally, we demonstrate that constitutively active forms of ALK1 and ALK5 both inhibit growth factor-induced endothelial sprouting from embryoid bodies. In conclusion, the use of this ESC differentiation model allowed us to propose the following model: at early stages of development, TGFbeta1, through the ALK5 receptor, is provasculogenic in a VEGF-independent manner. Later, in differentiated endothelial cells in which both ALK1 and ALK5 are expressed, both receptors are implicated in inhibition of sprouting angiogenesis.