(A) Periosteum is a well-microvascularized tissue, consisting of an outer fibrous layer and an inner cambium layer. Children have thicker and better-vascularized cambium layers than adults (i versus ii). (B) The cambium layer contains abundant stem/progenitor cells that can differentiate into bone and cartilage (i). Following fracture or osteotomy, progenitor cells residing in the periosteum are activated and enter the cell cycle (ii), followed by differentiation into osteoblastic and chondrogenic (green) lineage cells (iii). Further differentiation of the osteoblasts and chondrocytes leads to intramembranous bone formation (gray) and a mature cartilage template (blue) (iv). The vascular invasion of the cartilage template (v) coupled with bone formation completes the process of endochondral bone repair (vi).