Local production of prostaglandins by osteoblasts may be important in controlling the bone resorbing activity of some hormones which have receptors on osteoblasts. We have demonstrated that osteoblast-like cells derived from human bone can incorporate [14C]arachidonic acid into phospholipids and synthesise immunoreactive PGE. Parathyroid hormone increases both the release of incorporated arachidonic acid and the synthesis of PGE. This is the first demonstration of modulation of bone cell prostaglandin synthesis by a bone resorbing hormone.