Myocardin-related transcription factor (MRTF) and TAZ are major mechanosensitive transcriptional co-activators that link cytoskeleton organization to gene expression. Despite many similarities in their regulation, their physical and/or functional interactions are unknown. Here we show that MRTF and TAZ associate partly through a WW domain-dependent mechanism, and exhibit multilevel crosstalk affecting each other's expression, transport and transcriptional activity. Specifically, MRTF is essential for TAZ expression; TAZ and MRTF inhibit each other's cytosolic mobility and stimulus-induced nuclear accumulation; they antagonize each other's stimulatory effect on the α-smooth muscle actin (SMA) promoter, which harbours nearby cis-elements for both, but synergize on isolated TEAD-elements. Importantly, TAZ confers Smad3 sensitivity to the SMA promoter. Thus, TAZ is a context-dependent switch during mechanical versus mechano/chemical signalling, which inhibits stretch-induced but is indispensable for stretch+TGFβ-induced SMA expression. Crosstalk between these cytoskeleton-regulated factors seems critical for fine-tuning mechanical and mechanochemical transcriptional programmes underlying myofibroblast transition, wound healing and fibrogenesis.