Chondrosarcomas are malignant cartilage-forming tumors arising centrally in bone (central chondrosarcoma) or within the cartilaginous cap of osteochondroma (peripheral chondrosarcoma). For hereditary multiple osteochondromas, two responsible genes, EXT1 and EXT2, have been cloned. Their recently elucidated role in heparan sulfate biosynthesis and Hedgehog diffusion leads to the hypothesis that EXT inactivation affects fibroblast growth factor (FGF) and Indian Hedgehog (IHh)/parathyroid hormone-related peptide (PTHrP) signaling, two important pathways in chondrocyte proliferation and differentiation. The expression of PTHrP, PTHrP-receptor, Bcl-2, FGF2, FGFR1, FGFR3, and p21 is investigated by immunohistochemistry in osteochondromas (n = 24) and peripheral (n = 29) and central (n = 20) chondrosarcomas. IHh/PTHrP and FGF signaling molecules are mostly absent in osteochondromas. Although no somatic EXT mutations were found in sporadic osteochondromas, the putative EXT downstream targets are affected similarly in sporadic and hereditary tumors. In chondrosarcomas, re-expression of FGF2, FGFR1, PTHrP, Bcl-2, and p21 is found. Expression levels increase with increasing histological grade. Up-regulation of PTHrP and Bcl-2 characterizes malignant transformation of osteochondroma because PTHrP and Bcl-2 expression is significantly higher in borderline and grade I peripheral chondrosarcomas compared with osteochondromas. In contrast, up-regulation of PTHrP and Bcl-2 seems to be a late event in central cartilaginous tumorigenesis because expression is mainly restricted to high-grade central tumors.