Tumor necrosis factor-alpha (TNF-alpha), a 17-kDa cytokine produced by stimulated macrophages/monocytes, modulates the functions of a variety of cells and has been shown to induce bone resorption in vitro. However, the effects that TNF-alpha may have on the process of bone formation are not completely understood. In order to study the effects of TNF-alpha on matrix development and mineralization, we utilized a human osteoblastic cell line, HOS TE85. Our results show that HOS TE85, which has been shown to be responsive to hormones active on normal osteoblasts, forms an extensive extracellular matrix (ECM) that mineralizes during extended culture. Treatment during the development of the matrix with TNF-alpha has little effect on cell number and DNA synthesis, showing thereby that TNF-alpha is not cytotoxic to the cells. However, TNF-alpha inhibits the formation of alkaline phosphatase (AP)-positive foci in a dose-dependent manner at concentrations of 0.1-10 ng/ml. TNF-alpha treatment caused a significant decrease in the incorporation of collagen into the developing matrix. In addition, TNF-alpha treatment resulted in a significant decrease in the synthesis of AP by HOS TE85 cells during the process of ECM formation and resulted in a pronounced lack of mineralization of the ECM. These results indicate that TNF-alpha may be acting as an uncoupler by decreasing the synthesis and incorporation of proteins required for bane formation, and inhibiting matrix formation and mineralization in vitro.