Parathyroid hormone-related peptide (PTHrp), a polypeptide synthesized by tumors associated with hypercalcemia and known to cause bone resorption, was examined for its effects on bone formation in cultures of 21–day fetal rat calvariae. Continuous treatment with PTHrp for 24-72 h stimulated DNA synthesis, but inhibited [3H]proline incorporation into collagen by about 50%. In contrast, transient exposure to PTHrp at 0.1–1.0 nM for 24 h followed by removal of the factor for 48 h caused an increase in [3H]proline incorporation into collagen and noncollagen protein by 2- and 1.6-fold, respectively. The stimulatory effect was seen in the periosteum-free bone, and was decreased, but not prevented by hydroxyurea. PTHrp at 1–10 nM for 24 h increased medium insulin-like growth factor (IGF) I levels by 2.5–4.4-fold, and the effect was sustained 48 h after the removal of the agent. An IGF I neutralizing antibody prevented the stimulatory effect of PTHrp on bone collagen synthesis. PTH had the same stimulatory effects as those of PTHrp on bone collagen synthesis and IGF I concentrations, although slightly lower doses were needed to observe the enhancement of [3H]proline incorporation into collagen. It is concluded that continuous treatment with PTHrp inhibits, whereas transient treatment stimulates, collagen synthesis; the stimulatory effect appears mediated by an enhancement in the local production of IGF I. © 1990 by The Endocrine Society.