Injections of parathyroid hormone (PTH) have been reported to stimulate skeletal accretion through increased bone formation in several species, and osteoblast proliferation is a critical component of bone formation. However, the biological mechanisms of PTH-stimulated bone cell proliferation are largely unknown. In this study, we demonstrated that PTH stimulates proliferation of the osteoblast precursor cell line, TE-85, in association with increasing cdc2 protein levels and its kinase activity. cdc2 antisense oligonucleotides blocked PTH-induced DNA synthesis and cell cycle progression. Analysis of the time course of PTH-stimulated cdc2 message levels demonstrated that cdc2 mRNA levels were increased 1.5- to 4-fold between 3-18 h following release from cell synchronization. Transfections of TE-85 cells with a series of cdc2 promoter-luciferase deletion constructs revealed PTH stimulation of the cdc2 promoter. Promoter constructs containing a mutation in the E2F binding site were not stimulated by PTH. Gel mobility shift assays demonstrated increased free E2F levels in TE-85 nuclear extracts in response to PTH. Furthermore, the ratios of hyperphosphorylated to hypophosphorylated forms of Rb protein were increased by PTH treatment. These results demonstrate that PTH-stimulated cdc2 expression was associated with TE-85 cell proliferation and that the mechanism of stimulating cdc2 gene expression involved increasing the levels of free E2F.