TGF-β1 plays biphasic functions in prostate tumorigenesis, inhibiting cell growth at early stages but promoting malignant progression at later stages. However, the molecular basis for the oncogenic conversion of TGF-β1 function remains largely undefined. Here, we demonstrate that PPARδ is a direct transcription target of TGF-β1 and plays a critical role in oncogenic redirection of TGF-β1 signaling. Blockade of PPARδ induction enhances tumor cell response to TGF-β1-mediated growth inhibition, while its activation promotes TGF-β1-induced tumor growth, migration and invasion. PPARδ-mediated switch of TGF-β1 function is associated with down- and upregulation of Smad and ERK signaling, respectively, and tightly linked to its function to activate ABCA1 cholesterol transporter followed by caveolin-1 (Cav1) induction. Intriguingly, TGF-β1 activation of the PPARδ-ABCA1-Cav1 pathway facilitates degradation of TGF-β receptors (TβRs) and attenuates Smad but enhances ERK response to TGF-β1. Expression of PPARδ and Cav1 is tightly correlated in both prostate tissues and cell lines and significantly higher in cancer vs. normal tissues. Collectively, our study shows that PPARδ is a transcription target of TGF-β1 and contributes to the oncogenic conversion of TGF-β1 function through activation of the ABCA1-Cav1-TβR signaling axis.