Osterix (Osx) is a transcription factor required for the differentiation of preosteoblasts into fully functioning osteoblasts. However, the pattern of Osx activation during preosteoblast differentiation and maturation has not been clearly defined. Our aim was to study Osx activation during these processes in osteoblasts differentiating from murine and human embryonic stem cells (ESC). To do this, we constructed an Osx-GFP fusion protein reporter system to track Osx translocation within the cells. The distribution of Osx-GFP at representative stages of differentiation was also investigated by screening primary osteoblasts, mesenchymal stem cells, synoviocytes, and pre-adipocytes. Our experiments revealed that Osx-GFP protein was detectable in the cytoplasm of cultured, differentiated ESC 4 days after plating of enzymatically dispersed embryoid bodies. Osterix-GFP protein became translocated into the nucleus on day 7 following transfer of differentiated ESC to osteogenic medium. After 14 days of differentiation, cells showing nuclear translocation of Osx-GFP formed rudimentary bone nodules that continued to increase in number over the following weeks (through day 21). We also found that Osx translocated into the nuclei of mesenchymal stem cells (C3H10T1/2) and pre-osteoblasts (MC3T3-E1) and showed partial activation in pre-adipocytes (MC3T3-L1). These data suggest that Osx activation occurs at a very early point in the differentiation of the mesenchymal-osteoblastic lineage. (c) 2005 Elsevier Inc. All rights reserved.