To evaluate the role of plasminogen activator inhibitor (PAI)-1, a key negative regulator of the plasmin system of extracellular matrix proteases in developmental bone growth and fracture repair, the bone phenotype of male adult PAI-1-deficient mice was determined and femoral fracture healing was compared with that of age- and sex-matched wild-type C57BL/6J control mice. Regarding bone phenotype, the length and size (but not cortical thickness) of the femur of male PAI-1-deficient mice were smaller than those of wild-type controls. Although the total bone mineral content of PAI-1-deficient mice was not significantly different from that of wild-type mice, the total bone area in PAI-1-deficient mice was smaller, leading to an increase in total bone mineral density. With respect to fracture healing, PAI-1-deficient mice developed fracture calluses that were larger and more mineralized than those of wild-type mice but only at 14 days postfracture. These changes were even greater given the smaller size of the normal femur in PAI-1-deficient mice. Surprisingly, the larger fracture callus remodeled rapidly to normal size and mineral content by 21 days postfracture. Examination of fracture histology revealed that these changes were associated with a dramatic increase followed by a rapid remodeling of the fracture callus cartilage. The remodeling of fracture callus cartilage in PAI-1-deficient mice also displayed an abnormal pattern. These findings demonstrate for the first time that PAI-1 (and potentially the plasminogen extracellular matrix protease system) is an important regulator of bone size during developmental growth and plays a regulatory role in the determination of fracture callus size, cartilage formation, and resorption during bone fracture repair.