Exosomes are small membrane vesicles secreted into the extracellular environment by various types of cells, including tumor cells. Exosomes are enriched with a discrete set of cellular proteins, and therefore expected to exert diverse biological functions according to cell origin. Mesenchymal stem cells (MSCs) possess the potential for differentiation into multilineages and can also function as precursors for tumor stroma including myofibroblast that provides a favorable environment for tumor progression. Although a close relationship between tumor cells and MSCs in a neoplastic tumor microenvironment has already been revealed, how this communication works is poorly understood. In this study, we investigated the influence of tumor cell-derived exosomes on MSCs by treating adipose tissue-derived MSCs (ADSCs) with breast cancer-derived exosomes. The exosome-treated ADSCs exhibited the phenotypes of tumor-associated myofibroblasts with increased expression of α-SMA. Exosome treatment also induced increased expression of tumor-promoting factors SDF-1, VEGF, CCL5 and TGFβ. This phenomenon was correlated with increased expression of TGFβ receptor I and II. Analysis of SMAD2, a key player in the TGFβ receptor-mediated SMAD pathway, revealed that its phosphorylation was increased by exosome treatment and was inhibited by treatment with SB431542, an inhibitor of the SMAD-mediated pathway, resulting in decreased expression of α-SMA. Taken together, our results show that tumor-derived exosomes induced the myofibroblastic phenotype and functionality in ADSCs via the SMAD-mediated signaling pathway. In conclusion, this study suggests that tumor-derived exosomes can contribute to progression and malignancy of tumor cells by converting MSCs within tumor stroma into tumor-associated myofibroblasts in the tumor microenvironment.