Bone morphogenetic proteins (BMPs) play pivotal roles in bone and cartilage growth and repair. Through phenotypes of short-ear (se) mice, which have BMP-5 mutations, a role for BMP-5 in some specific aspects of skeletogenesis and cartilage growth is known. This report examines BMP-5 expression in the growth plate and in differentiating cultures of primary chondrocytes, and the effects of addition of BMP-5 or its inhibition by anti-BMP-5 antibody in chondrocyte cultures. By laser capture microdissection and immunohistochemistry, we found that BMP-5 is expressed in proliferating zone (PZ) chondrocytes and that the expression increases sharply with hypertrophic differentiation. A similar pattern was observed in differentiating cultures of primary chondrocytes, with BMP-5 expression increasing as cells differentiated, in contrast to other BMPs. BMP-5 added to cultures increased cell proliferation early in the culture period and also stimulated cartilage matrix synthesis. Also, BMP-5 addition to the cultures activated phosphorylation of Smad 1/5/8 and p38 MAP kinase and caused increased nuclear accumulation of phospho-Smads. Anti-BMP-5 antibody inhibited the endogenous BMP-5, reducing cell proliferation and phospho-Smad nuclear accumulation. Together, the results demonstrate that BMP-5 is normally an important regulator of chondrocyte proliferation and differentiation. Whether other BMPs may compensate in BMP-5 loss-of-function mutations is discussed. J. Cell. Physiol. 214:56–64, 2008. © 2007 Wiley-Liss, Inc.