The SMAD family member 2 (SMAD2), a member of the TGF-beta superfamily, executes a significant part in the oogenesis and ovulation process. A genome-wide selective sweep analysis also found SMAD2 was different in the fertility groups of Laoshan dairy goats; whether this gene was linked to litter size was unknown. Therefore, SMAD2 was chosen to study its effects on Shaanbei white cashmere goat reproduction and mRNA expression profile. Herein, the mRNA expression level of SMAD2 was firstly determined in female goat tissues, revealing significant differences in mRNA levels of different tissues (p < 0.05), including ovary tissue, indicating a potential role for SMAD2 in goat prolificacy. Then, using six pairs of primers, only one indel locus (P3-Del-12-bp) was found to be polymorphic in goat SMAD2 (n = 501). ANOVA also revealed that a P3-Del-12-bp deletion was significantly related to first-born litter size (p = 0.037). The Chi-square (χ2) test revealed that the ID genotype was significantly more prevalent in mothers with multiple lambs (p = 0.01), indicating that heterozygous individuals (ID) are more likely to produce multiple lambs. Our findings suggest that the SMAD2 gene's P3-Del-12-bp deletion could be used to improve goat breeds by assisting with litter size selection.