It is well-known that osteoporosis is a common complication of patients with glucocorticoid excess. We previously reported that dexamethasone inhibits Ca2+ influx induced by prostaglandin E2 (PGE2), a potent bone resorbing agent, in osteoblast-like MC3T3-E1 cells (O. Kozawa, H. Tokuda, J. Kotoyori, A. Suzuki, Y. Ito and Y. Oiso, Prostagland Leuk Essent Fatty Acids, in press). In the present study, we examined the effects of dexamethasone on cyclic adenosine monophosphate (cAMP) accumulation and phosphoinositide hydrolysis by PGE2 in MC3T3-E1 cells. The pretreatment with dexamethasone significantly inhibited cAMP accumulation stimulated by PGE2 in a dose-dependent manner in the range between 10 pM and 1 nM in MC3T3-E1 cells. This effect of dexamethasone was dependent on the time of pretreatment up to 8 h. Dexamethasone also inhibited the cAMP accumulation induced by NaF, an activator of guanosine triphosphate (GTP)-binding protein, or forskolin which directly activates adenylate cyclase. In contrast, dexamethasone had little effect on the formation of inositol phosphates stimulated by PGE2 in MC3T3-E1 cells. These results strongly suggest that glucocorticoid modulates the signal transduction by PGE2 in osteoblast-like cells and that it inhibits PGE2-induced cAMP production without affecting PGE2-induced phosphoinositide hydrolysis.