The recent demonstration of estrogen receptors in bone derived cells has stimulated the study of direct effects of sex steroids on bone. We have shown direct stimulation of proliferation by 17 beta-estradiol (E2) of ROS 17/2.8 rat osteogenic osteosarcoma cells, and other bone-derived cells in culture, as well as sex-specific stimulation of diaphyseal bone in vivo by estrogen and testosterone, using [3H]thymidine incorporation into DNA and stimulation of the specific activity of creatine kinase as markers. ROS 17/2.8 cells were used as models of osteoblast-like cells to study the reciprocal modulation of stimulation of bone cell proliferation by sequential treatment by sex steroid and calciotrophic hormones. Pretreatment with 1,25(OH)2D3 and PTH augmented stimulation by E2, while pretreatment with PGE2 followed by E2 resulted in no additional stimulation. Reciprocally, pretreatment with E2 significantly reduced the response to PGE2 while showing an insignificant effect on the response to the other hormones. Gonadectomized Wistar-derived rats provided a useful model system for study of postmenopausal osteoporosis. In diaphyseal bone, [3H]thymidine incorporation and creatine kinase activity decreased 4 weeks after gonadectomy. At that time, a single i.p. injection of E2 in females, and testosterone in males, resulted in a highly significant increase in both these parameters within 24 h.