Loss of p53 function is seen in a large number of human tumors including osteosarcoma, and in previous studies we have demonstrated a close relationship between wild type p53 and osteoblasts differentiation. In the present study we attempted to understand the relationship of bone growth and differentiation to p53 gene dosage by studying calvarial osteoblasts obtained from p53 deficient mice. Growth rules were higher in p53 -/- than p53 +/- osteoblasts when passaged for different lenght of time. However, loss of the remaining wt allele occurred early during culturing of the p53 +/- cells, and these cells became immortalized with growth rates and doubling times reaching values higher than the p53 -/- homozygotes. Early passage osteoblasts were used to study differentiation properties of these osteoblasts in vitro by exposing them to differentiation promoting media. While osteocalcin, a marker protein of differentiated osteoblasts, was synthesized in both cell types, p53 -/- cells consistently showed higher levels of osteocalcin activity, and in long term cultures formed more bone spicules that p53 +/- cells. Basal osteocalcin promoter activity was similar in both cell types, but transient transfection of wt p53 into the cells produced a larger activation of the promoter in p53 +/- cells, than in p53 -/- cells. Sections of long bones from neonatal p53 +/- and -/- were examined histologically, and no gross abnormalities were detected. TUNEL staining of the bones showed apoptotic cells in the growth plate and lining cells of both p53 genotypes, but apoptosis in hypertrophic chondrocytes was seen only in p53 +/- bones. Overall our studies show that osteoblastic differentiation becomes a p53 dependent process only when at least one functional copy of the p53 gene is present during development.