Melanocortin receptors belong to the seven transmembrane domain, G-protein coupled family of receptors. There are five members of this receptor family labeled MC1R-MC5R. These receptors are activated by fragments derived from a larger molecule, proopiomelanocortin (POMC) and include ACTH, alpha beta and gamma-MSH and beta-endorphin. Because of in vitro and in vivo data suggesting direct effects of these POMC molecules on bone and bone turnover, we examined bone and bone derived cells for the presence of the various members of the melanocortin receptor family. We report that the five known melanocortin receptors are expressed to varying degrees in osteoblast-like and osteoclastic cells. POMC fragments increased proliferation and expression of a variety of genes in osteoblastic cells. Furthermore, POMC mRNA was detected in osteoclastic cells. These data demonstrate that POMC-derived peptide hormones acting through high affinity melanocortin receptors have specific effects on bone cells. Thus, in addition to the indirect effects of POMC-derived hormones on bone turnover through their modulation of steroid hormone secretion, POMC fragments may have direct and specific effects on bone cell subpopulations.