Murine bone marrow cells synthesize bone proteins, including alkaline phosphatase (ALP), collagen type I, and osteocalcin, and form a mineralized extracellular matrix when cultured in the presence of beta- glycerophosphate and vitamin C. Interleukin-10 (IL-10) suppressed the synthesis of these bone proteins and mineralization without affecting cell proliferation. In addition, mRNA levels for the latter proteins were reduced in IL-10-treated cultures. This inhibitory effect was most outspoken when IL-10 was added before ALP activity peaked, eg, day 15 of culture. No significant effect was observed when IL-10 was added at later time points. This finding suggests that IL-10 acts at osteogenic differentiation stages that precede ALP expression but is ineffective on cells that progressed beyond this maturation stage. Likewise, IL-10 appeared to be unable to block both ALP activity and collagen synthesis in the preosteosteoblastic cell lines MN7 and MC3T3 that constitutively synthesize these proteins. Whereas IL-10 did not alter the number of fibroblast colony-forming cells of the marrow, it significantly reduced their osteogenic differentiation potential. In contrast to control cultures, IL-10-treated stroma was unable to either synthesize osteocalcin or to mineralize when subcultured over a 25-day period in the absence of IL-10. The inhibitory activity of IL-10 coincided with significant changes in stroma morphology. Whereas control cultures contained mainly flat adherent polygonal cells, significant numbers of rounded semiadherent to nonadherent cells were observed in the presence of IL-10. Scanning and transmission electron microscopy showed that, in contrast to control cultures, IL-10-treated stromas completely lacked a mineralized extracellular matrix. Collectively, these data suggest that IL-10 may have important regulatory effects on bone biology because of its capacity to downregulate early steps of osteogenic differentiation.