Parathyroid hormone-related peptide (PTHrP) was discovered as the main mediator of humoral hypercalcemia associated with malignancy but is now known to be expressed by a variety of normal fetal and adult tissues. The amino-terminal region of PTHrP reveals limited but significant homology with parathyroid hormone (PTH), resulting in the interaction of either peptide with a common seven-transmembrane spanning G-protein linked receptor termed the PTH PTHrP receptor. Targeted inactivation of PTHrP and its receptor in mice has established a critical role for this signaling pathway in chondrocyte biology and endochondral bone formation. Animals homozygous for the targeted alleles demonstrate marked skeletal deformities arising from impaired chondrocyte proliferation, premature differentiation and accelerated apoptosis. The complex processes resulting in normal endochondral bone development involve additional factors such as the hedgehog signaling pathway with which PTHrP interacts. PTHrP, like PTH, also binds to receptors on cells of the osteoblast lineage resulting in enhanced bone formation and also, indirectly, augmented osteoclastic bone resorption. The marked premature osteoporosis observed in mice heterozygous for the disrupted Pthrp allele also points to a crucial role for the protein in the maintenance of the adult skeleton. Further studies into this process are likely to reveal new facets of the pathogenesis underlying a variety of metabolic bone diseases and potentially point to new directions for therapeutic interventions.