Previous studies in our laboratory demonstrated messenger RNA for bone morphogenetic protein-2a in human calcified plaque, suggesting that arterial calcification is a regulated process, similar to osteogenesis. To further test this hypothesis, we have isolated and cloned a subpopulation of cells from bovine aortic media that show osteoblastic potential. These novel cells are primarily distinguished from smooth muscle cells by expression of a surface marker preliminarily identified as a modified form of the ganglioside sialyl-lactosylceramide (GM3). Osteoblastic potential was indicated by high levels of alkaline phosphatase and collagen I, expression of osteopontin and osteonectin (SPARC), and production of bone-specific osteocalcin and hydroxyapatite. Cultures of these cells were stimulated to form increased numbers of calcium-mineral-producing nodules by the oxysterol 25-hydroxycholesterol as well as by transforming growth factor-beta 1, both known to be present in atherosclerotic lesions. The stimulation of calcifying vascular cells in the artery wall by these two factors suggests a possible mechanism for the colocalization of calcification with atherosclerosis in vivo.