Bone growth and maintenance are highly regulated processes. Throughout life, bone constantly undergoes remodelling, maintaining a balance between bone formation by osteoblasts and bone resorption by osteoclasts. This balance depends on the coordinated activities of many systemic hormones and locally acting factors in the bone microenvironment. Understanding the mechanisms of action of these factors provides a better appreciation of the cellular and molecular basis of bone remodelling. Adrenomedullin has recently been found to stimulate the proliferation of osteoblasts in vitro, and to increase indices of bone formation when administered either locally or systemically in vivo. Adrenomedullin receptors, as well as adrenomedullin itself, are expressed in primary osteoblasts and in osteoblast-like cell lines. In this paper we discuss the anabolic effect of adrenomedullin in bone, and present new evidence for a possible role of adrenomedullin in the regulation of cartilage cells. We show that adrenomedullin stimulates proliferation of primary chondrocytes in culture and that mRNA for adrenomedullin and for adrenomedullin receptors are expressed in these cells. Studies of structure-activity relationships have demonstrated that osteotropic effects of adrenomedullin can be retained in peptide fragments of the molecule which lack the parent molecule's vasodilatory properties. Thus, these small peptides, or their analogues, are attractive candidates as anabolic therapies for osteoporosis.