Differentiation of phenotypically normal osteoblast cultures leads to formation of a bone-like extracellular matrix in vitro. Maximum collagen synthesis occurs early in the life of these cultures, whereas insoluble collagen deposition occurs later and is accompanied by a diminished rate of collagen synthesis. The mechanisms that control collagen deposition seem likely to include regulation of extracellular collagen biosynthetic enzymes, but expression patterns of these enzymes in differentiating osteoblasts has received little attention. The present study determined the regulation of lysyl oxidase as a function of differentiation of phenotypically normal murine MC3T3-E1 cells at the level of RNA and protein expression and enzyme activity. In addition, the regulation of BMP-1/mTLD mRNA levels that encodes procollagen C-proteinases was assayed. The role of lysyl oxidase in controlling insoluble collagen accumulation was further investigated in inhibition studies utilizing beta-aminopropionitrile, a specific inhibitor of lysyl oxidase enzyme activity. Results indicate that lysyl oxidase is regulated as a function of differentiation of MC3T3-E1 cells, and that the maximum increase in lysyl oxidase activity precedes the most efficient phase of insoluble collagen accumulation. By contrast BMP-1/mTLD is more constitutively expressed. Inhibition of lysyl oxidase in these cultures increases the accumulation of abnormal collagen fibrils, as determined by solubility studies and by electron microscopy. Taken together, these data support that regulation of lysyl oxidase activity plays a key role in the control of collagen deposition by osteoblast cultures.