To determine the effects of locally-expressed insulin-like growth factor (IGF-I) on bone remodeling, a transgene was produced in which murine IGF-I cDNA was cloned downstream of a gene fragment comprising 3.6 kb of 5' upstream regulatory sequence and most of the first intron of the rat Col1a1 gene. The construct was expressed at the mRNA and protein level in transfected osteoblasts. Five lines of transgenic mice were generated by embryo microinjection. Transgene mRNA levels were highest in calvaria, long bone and tendon, and lower in skin. Serum IGF-I and body weight were increased in males and females only in the highest expressing line. Histomorphometry showed that transgenic calvaria were wider and had greater marrow area and bone area. Transgenic calvaria had increased osteoclast number per bone surface. Percent collagen synthesis and cell replication were increased in transgenic calvaria. Femur length, cortical width and cross-sectional area were increased in transgenic femurs of the highest expressing line, while femoral trabecular bone volume was little affected. Thus, broad overexpression of IGF-I in cells of the osteoblast lineage increased indices of bone formation and resorption.