The steroid modulation of collagen metabolism was studied by injecting chick embryos with dexamethasone in vivo, and collagen synthesis was subsequently assayed by pulse-labeling the tissue with [14C]proline in vitro. The synthesis of [14C]hydroxyproline in tendons and sterna from chick embryos treated with dexamethasone was markedly reduced as compared with untreated controls. The inhibition of [3H]hydroxyproline synthesis was accompanied by a similar reduction in type I and II procollagen mRNA levels, as detected by Northern blot and dot blot hybridizations with chick pro alpha 1(I), pro alpha 2(I) and pro alpha 1(II) sequence specific cDNAs. The reduction in type II procollagen mRNA level was shown to be dose dependent. Control experiments indicated that the post-translational hydroxylation of prolyl residues was only slightly decreased in dexamethasone treated animals, and that the specific activity of the intracellular free proline pool and the intracellular degradation of collagen were unchanged. To address the mechanisms of the inhibition of collagen biosynthesis, specific binding of dexamethasone to glucocorticoid receptors in chick embryo tendon and cartilage cells was studied in a whole cell assay using [3H]dexamethasone as the ligand. Matrix-free tendon and cartilage cells had approximately 19,000 and 15,000 receptor sites per cell, respectively, and the binding affinities (Kd) for dexamethasone in tendon and cartilage cells were 2.9 x 10(-9) and 2.3 x 10(-9) M. Comparable values were obtained using a cytosol binding assay. The nuclear binding of dexamethasone in tendon and cartilage cells were similar. The results suggest that the dexamethasone-induced inhibition of collagen production is primarily due to decreased levels of functional procollagen mRNA, possibly resulting from receptor-mediated inhibition of the gene expression on the transcriptional level.