The present study was undertaken to determine the possible cellular mechanism of action of angiopoietin-2 in bone metabolism. The effects on the osteoblasts were determined by measuring 1) cell viability, 2) alkaline phosphatase (ALP) activity, 3) gelatinase activity, and 4) nitric oxide production. The effects on the osteoclasts were investigated by measuring 1) tartrate-resistant acid phosphatase (TRAP)(+) multinucleated cells (MNCs) formation, and 2) resorption areas after culturing osteoclast precursors. Angiopoietin-2 treatment showed a significant increase in both the viability and ALP activity of osteoblasts. Angiopoietin-2 increased the activity of gelatinase and nitric oxide production. In addition, angiopoietin-2 decreased the osteoclast generation induced by macrophage-colony stimulating factor (M-CSF) and receptor activator of NF-kB ligand (RANKL), and inhibited osteoclastic activity in (M-CSF)-dependent bone marrow macrophage (MDBM) cell cultures. Taken these results, angiopoietin-2 may be a regulatory protein within the bone marrow microenvironment.