Pigment epithelium-derived factor (PEDF) has been shown to be the most potent inhibitor of angiogenesis in the mammalian eye, thus suggesting that loss of PEDF is involved in angiogenic eye diseases such as proliferative diabetic retinopathy. Angiogenesis is required for tumor growth and progression as well. We, along with others, have recently found that PEDF could inhibit growth of melanoma and hepatocellular carcinoma in nude mice through its anti-angiogenic effects on tumor endothelial cells. However, the possibility of the direct effect of PEDF on tumor cells has remained. In this study, we investigated the effects of PEDF on growth and vascular endothelial growth factor (VEGF) expression in MG63 human cultured osteosarcoma cells. PEDF decreased viable cell number as well as DNA synthesis in MG63 cells in a dose-dependent manner. Furthermore, PEDF was found to increase caspase-3/7 activity and to subsequently induce apoptotic cell death in MG63 cells. PEDF also inhibited VEGF expression in MG63 cells at both mRNA and protein levels. Our present study provides novel beneficial aspects of PEDF on osteosarcoma cells; one is induction of apoptotic cell death of tumor cells, and the other is the suppression of VEGF expression, which would lead to inhibition of tumor angiogenesis. PEDF therefore might be a promising therapeutic agent for treatment of patients with osteosarcoma.