We previously described an osteocalcin (OC) fibroblast growth factor (FGF) response element (FRE) DNA binding activity as a target of Msx2 transcriptional regulation. We now identify Ku70, Ku80, and Tbdn100, a variant of Tubedown-1, as constituents of the purified OCFRE-binding complex. Northern and Western blot analyses demonstrate expression of Ku and Tbdn100 in MC3T3E1 osteoblasts. FGF2 treatment regulates Ku, but not Tbdn100, protein accumulation. Gel supershift studies confirm sequence-specific DNA binding of Ku in the OCFRE complex; chromatin immunoprecipitation assays confirm association of Ku and Tbdn100 with the endogenous OC promoter. In the promoter region-154 to -113, the OCFRE is juxtaposed to OSE2, an osteoblast-specific element that binds Runx2 (Osf2, Cbfa1). Expression of the Ku·Tbdn100 complex up-regulates both the basal and Runx2-dependent transcription driven by this 42-bp OC promoter element, reconstituted in CV-1 cells. Synergistic transactivation occurs in the presence of activated FGF receptor 2 signaling. Msx2 suppresses Ku- and Runx2-dependent transcription; suppression is dependent upon the Msx2 homeodomain NH2-terminal arm and extension. Pull-down assays confirm physical interactions between Ku and these coregulatory transcription factors, consistent with the functional interactions identified. Finally, cultured Ku70 -/- calvarial cells exhibit a profound, selective deficiency in OC expression as compared with wild-type calvarial cells, confirming the biochemical data showing a role for Ku in OC transcription. In toto, these data indicate that a novel Ku antigen complex assembles on the OC promoter, functioning in concert with Msx2 and Runx2 to regulate OC gene expression.