The parafollicular-cell (C-cell) hormone calcitonin (CT) can preserve or even augment skeletal mass by inhibiting osteoclast-mediated bone resorption. The possibility of an additional anabolic skeletal influence has also been raised: C cells might, via CT or other secretory products, affect osteoblast-mediated bone formation. The 57-residue amino-terminal procalcitonin cleavage peptide, N-proCT, has recently been identified in human and rat C cells, where it is made and secreted in equimolar amounts with CT. The coelaboration of N-proCT and CT and N-proCT's sequence conservation during evolution prompted us to investigate the potential skeletal bioactivity of N-proCT. We found that synthetic human N-proCT, at nanomolar concentrations, stimulated proliferation of normal and neoplastic human osteoblasts. At maximally effective doses, human N-proCT caused more than a 100% increase above the control rate of DNA synthesis, an effect comparable to the maximal growth effect of insulin, a potent mitogen for osteoblasts. Human N-proCT exerted a similar maximal mitogenic effect in chicken osteoblast cultures but at 1000-fold greater concentrations than in human bone-cell cultures. The bone-cell action of N-proCT was potentiated with insulin with a greater than 200% increase in DNA synthesis at high insulin concentrations. In sharp contrast to these findings for N-proCT, the other bioactive C-cell peptides, CT and somatostatin, showed no mitogenic effects in human or chicken osteoblast cultures. Our results indicate that the action of N-proCT on cultured bone cells is separate from and potentiated by insulin, a known growth factor. Unlike insulin and related growth factors such as insulin-like growth factor I, N-proCT is not mitogenic in skin fibroblast cultures. We propose that N-proCT is a C-cell hormone that promotes bone formation via stimulatory actions on osteoblasts and preosteoblasts.