We previously isolated a mammalian gene STC1 that encodes a glycoprotein related to stanniocalcin (STC), a fish hormone that plays a major role in calcium homeostasis. However, the mammalian STC1 gene is expressed in a variety of adult tissues in contrast to fish where STC is expressed only in one unique gland, the corpuscles of Stannius. This suggested that STC1 may have wider autocrine/paracrine functions in mammals. In the present study, using immunocytochemistry, we showed that STC1 protein is localized in the developing bone and muscle of the mouse fetus. During endochondral bone formation, STC1 is found principally in prechondrocytes and prehypertrophic chondrocytes. During intramembranous bone formation STC1 is present in the mesenchyme that is about to undergo ossification. STC1 is also found in the myocardiocytes of the developing heart and at all stages of differentiation from myoblasts to myotube formation in developing skeletal muscle. The specific localization of STC1 to chondrocytes and muscle cells suggests a role for this protein in chondrogenic and myogenic differentiation.