Cell-cell contacts inhibit cell growth and proliferation in part by activating the Hippo pathway that drives the phosphorylation and nuclear exclusion of the transcriptional coactivators YAP and TAZ. Cell density and Hippo signaling have also been reported to block transforming growth factor β (TGF-β) responses, based on the ability of phospho-YAP/TAZ to sequester TGF-β-activated SMAD complexes in the cytoplasm. Herein, we provide evidence that epithelial cell polarization interferes with TGF-β signaling well upstream and independent of cytoplasmic YAP/TAZ. Rather, polarized basolateral presentation of TGF-β receptors I and II deprives apically delivered TGF-β of access to its receptors. Basolateral ligand delivery nonetheless remains entirely effective to induce TGF-β responses. These data demonstrate that cell-type-specific inhibition of TGF-β signaling by cell density is restricted to polarized epithelial cells and reflects the polarized distribution of TGF-β receptors, which thus affects SMAD activation irrespective of Hippo pathway activation.