We investigated whether stem cells (MDSC) from primary cultures of rat skeletal muscle can differentiate into the smooth muscle lineage in response to vascular endothelial growth factor (VEGF) and coculture with bladder smooth muscle cells. The MDSC were isolated from gastrocnemius muscle biopsies of normal 3-6 week-old Sprague-Dawley rats and purified by the preplate technique. Cells that took approximately 6 days to adhere to the collagen-coated flasks were termed late preplate (LP) cells, and were used in all the experiments. The early plate (EP) cells (pp1-pp4) contained some myogenic cells but were mostly fibroblasts (< 15% desmin+ cells) whereas the LP cells (pp5-pp6) were highly purified muscle-derived cells (pp6) (> 90% desmin+ cells). The muscle-derived stem cells (LP cells) were CD34+ or Sca-1+, CD45- and desmin+ by immunohistochemical staining. After two days of co-culture with bladder smooth muscle cells, about 25% of the muscle-derived stem cells were positive for alpha-smooth muscle actin (alpha-SMA)+. RT-PCR for alpha-SMA was positive in the VEGF stimulated MDSC, but negative in the absence of VEGF. In conclusion, rat muscle-derived stem cells exhibited stem cell properties (CD34+ or Sca-1+), and were not of hematogeous (CD45-) but of myogenic origin (desmin+). RT-PCR of alpha-SMA was positive in the VEGF stimulated muscle-derived stem cells.