Angiogenesis is essential for the increased delivery of oxygen and nutrients required for the reparative processes of bone healing. Vascular endothelial growth factor (VEGF), a potent angiogenic growth factor, has been implicated in this process. We have previously shown that hypoxia specifically and potently regulates the expression of VEGF by osteoblasts. However, the molecular mechanisms governing this interaction remain unknown. In this study, we hypothesized that the hypoxic regulation of VEGF expression by osteoblasts occurs via an oxygen-sensing mechanism similar to the regulation of the erythropoietin gene (EPO). To test this hypothesis, we examined the kinetics of oxygen concentration on osteoblast VEGF expression. In addition, we analyzed the effects of nickel and cobalt on the expression of VEGF in osteoblastic cells because these metallic ions mimic hypoxia by binding to the heme portion of oxygen-sensing molecules. Our results indicated that hypoxia potently stimulates VEGF mRNA expression. In addition, we found that nickel and cobalt both stimulate VEGF gene expression in a similar time- and dose-dependent manner, suggesting the presence of a hemelike oxygen-sensing mechanism similar to that of the EPO gene. Moreover, actinomycin D, cycloheximide, dexamethasone, and mRNA stabilization studies collectively established that this regulation is predominantly transcriptional, does not require de novo protein synthesis, and is not likely mediated by the transcriptional activator AP-1. These studies demonstrate that hypoxia, nickel, and cobalt regulate VEGF expression in osteoblasts via a similar mechanism, implicating the involvement of a heme-containing oxygen-sensing molecule. This may represent an important mechanism of VEGF regulation leading to increased angiogenesis in the hypoxic microenvironment of healing bone.