To observe the differentiation and gene expression of human osteosarcoma cell line MG-63 in culture. Alkaline phosphatase (ALP) activity was determined by p-nitrophenyl phosphate assay; bone Gla protein (BGP) was measured by radioimmunoassay; type I collagen, matrix metalloproteinase (MMP)-1, tissue inhibitor of matrix metalloproteinase (TIMP)-1 mRNA were examined using semiquantitative reverse transcription-polymerase chain reaction (RT-PCR) analysis; MG-63 cells were stained by the Van GieSon method. Type I collagen mRNA expression achieved a maximum level on the 17th day in MG-63 cells; MMP-1 mRNA was not expressed until the 5th day of culture, and gradually increased; TIMP-1 mRNA was nearly constant; ALP activity gradually up-regulated during 0-12 days, and decreased on the 18th day. By Van GieSon staining, MG-63 cells displayed nodule formation at the 12th day, and became more prominent on the 18th day. The results indicate that human osteosarcoma cell line MG-63 has the osteoblast phenotype; during the differentiation of MG-63 cells, there are the following three principle periods: proliferation, extracellular matrix maturation and mineralization.