The dentin extracellular matrix contains a protein factor which has the ability to modulate the phenotypic expression of cultured fibroblasts, and switch them to produce products characteristic of chondrocytes. The dentin matrix has a BMP-like activity. That is, a dentin matrix implant into muscle in vivo induces bone formation on the model of the implant in a fashion entirely analogous to BMP-competent bone matrix. In the previous project period the dentin in vitro chondrogenic factor (CIA) was purified and partially characterized. The CIA composition was distinct from that of bone BMP and other members of the TGF-beta superfamily. The CIA was active as a Mr 6000 monomer, was unaffected by reduction, and did not contain the C-terminal Cys-rich region common to the TGF-beta superfamily. N-Terminal sequencing has led to the preparation of nucleotide probes and detection of putative CIA-clones which have been sequenced. In situ hybridization studies have been initiated to localize the CIA mRNA. The specific objectives of the continuation period are to: 1) fully characterize the CIA in terms of sequence and gene structure; 2) produce workable quantities of recombinant CIA and use the protein to examine in vitro the mechanism of CIA action;, and, 3) determine the in vivo activity of CIA+ carrier implants. In Objective 2, the nature of the phenotypic changes in collagen and proteoglycan production, the nature and number of cell surface receptors, and the induction of cell regulatory proteins will be studied in rat muscle fibroblasts and in the defined nonosteogenic line, C3Hl0T1/2. cDNA difference libraries will be prepared and screened. An important new development has been the induction of dense cartilage-like nodules in culture. These nodules can be implanted in vivo and will be investigated as an alternate bone/cartilage inductive repair system. Aside from their intrinsic interest, these 3 lines of investigation should lead to a better understanding of the regulation of cell differentiation during normal development as well as to the repair of hard-tissues.