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The cytokine TGFβ provides important information during embryonic development, adult tissue homeostasis, and regeneration. Alterations in the cellular response to TGFβ are involved in severe human diseases. To understand how cells encode the extracellular input and transmit its information to elicit appropriate responses, we acquired quantitative time-resolved measurements of pathway activation at the single-cell level. We established dynamic time warping to quantitatively compare signaling dynamics of thousands of individual cells and described heterogeneous single-cell responses by mathematical modeling. Our combined experimental and theoretical study revealed that the response to a given dose of TGFβ is determined cell specifically by the levels of defined signaling proteins. This heterogeneity in signaling protein expression leads to decomposition of cells into classes with qualitatively distinct signaling dynamics and phenotypic outcome. Negative feedback regulators promote heterogeneous signaling, as a SMAD7 knock-out specifically affected the signal duration in a subpopulation of cells. Taken together, we propose a quantitative framework that allows predicting and testing sources of cellular signaling heterogeneity.