A new bone cell line was established by transfecting normal adult human osteoblast-like (hOB) cells, derived from a 68-year-old woman, with the plasmid pSV3 neo. The plasmid included coding sequences and promotors for the large and small T antigens of the SV40 virus as well as resistance to the antibiotics neomycin and G418. A single antibiotic-resistant colony was located and cloned. Large tumor antigen production in the clonal cell line was confirmed by indirect immunofluorescence study. Treatment with 1,25-dihydroxy-vitamin D3 increased steady-state concentrations of protein and mRNA for osteocalcin and for alkaline phosphatase. Northern blot analyses also demonstrated the presence of mRNAs for α(I)-procollagen, osteopontin 1a, transforming growth factor β, and interleukin-1β. The plasma membrane calcium pump and osteonectin were identified by immunocytochemical analysis. These cells produced a matrix that mineralized when β-glycerophosphate was added to their cultures. As assessed by functional receptor assays, both estrogen and androgen receptors were present and functional, although at low concentrations. Treatment with parathyroid hormone did not stimulate adenylate cyclase activity. Thus, these cells are a well-differentiated, steroid-responsive clonal cell line that closely approximates the phenotype of the mature osteoblast. They should serve as an excellent model for the study of osteoblast biology.