A carboxyl-terminal peptide sequence ("osteostatin") from parathyroid hormone related protein has been shown to have an inhibitory effect on osteoclastic bone resorption--an action opposite to its amino-terminal sequence. In this study, we proposed that inhibition of osteoclastic bone resorption by osteostatin was associated with reduction of tartrate resistant acid phosphatase (TRAcP) activity in osteoclasts. Our results have indicated that osteostatin reduced TRAcP activity in a dose dependent manner. This effect of osteostatin was both sensitive (half maximal effect approximately 5 x 10(-13) M) and potent (maximum inhibition approximately 50% of control). In the first 90 min of treatment, however, reduction of TRAcP activity was erratic but became persistent and progressive when the time course was extended. Moreover, throughout the experimental period the levels of TRAcP activity in the culture medium had fallen significantly. It appears that osteostatin has a biphasic effect on TRAcP activity, inhibiting its secretion and either suppressing its synthesis or increasing its degradation. In addition, osteostatin induced rapid cellular retraction of both human and rat cultured osteoclasts, which was morphologically distinct from that produced by calcitonin.