Oncostatin M (OSM) has been described as a bone-remodeling factor either stimulating osteoblast activity or osteoclast formation in vitro. To elucidate the in vivo effect of OSM on bone remodeling, we injected an adenoviral vector encoding murine OSM in knee joints of mice. OSM strongly induced interleukin (IL)-6 gene expression, a known mediator of osteoclast development. We investigated the OSM effect in wild-type and IL-6-deficient mice and found a similar degree of OSM-induced joint inflammation. Within the first week of inflammation, the periosteum along the femur and tibia increased in cell number and stained positive for the osteoblast marker alkaline phosphatase. At these sites bone apposition occurred in both strains as demonstrated by Goldner and Von Kossa staining. In vitro OSM enhanced the effect of bone morphogenetic protein-2 on osteoblast differentiation. Immunohistochemistry demonstrated expression of receptor activator of nuclear factor-κB ligand (RANKL) and its receptor, receptor activator of nuclear factor-κB (RANK), in the periosteum but osteoclasts were not detected at sites of bone apposition. Induced mRNA expression for the receptor activator of nuclear factor-κB ligand inhibitor osteoprotegerin probably controlled osteoclast development during OSM overexpression. Our results show that OSM favors bone apposition at periosteal sites instead of resorption in vivo. This effect was not dependent on or inhibited by IL-6.