Treatment with purified bovine PTH (2000 U/mg) in vitro increased the cyclic- 3’5’AMP content of isolated bone cells dispersed from rat calvaria and maintained in monolayer culture. Theophylline (1-5 mM) markedly potentiated the action of PTH. In the presence of theophylline, PTH (1 μg/ml) raised bone cell cyclic-3’S’AMP 14-fold in 30 sec and 30-fold in ISO sec. Low concentrations of PTH (10-100 ng/ml) were moderately effective (2-4-fold increases) and a physiological concentration (1 ng/ml) gave a small (+ 25%) but statistically significant increase. A synthetic N-terminal peptide fragment (amino acids 1-34) of PTH was 50% as active as native hormone, whereas a synthetic 2-34 fragment was virtually inactive. Cyclic-3’5’ AMP increased slightly upon exposure to high concentrations of thyrocalcitonin, epinephrine, norepinephrine, or lysine vasopressin, but was not affected by adrenocorticotropin or insulin. Repeated subculturing caused a progressive decline in the sensitivity of bone cells to PTH. Isolated bone cells may be useful in clarifying the early events in PTH action, and in defining the form(s) of circulating biologically active hormone.