m-Calpain, a Ca 2+-dependent neutral cysteine proteinase (EC 3.4.22.17), has been demonstrated to be present in the lower hypertrophic zone of the rat growth plate. Using the pelleted culture system as an in vitro model of rat epiphyseal chondrocyte differentiation, we studied m-calpain contents and activities in pelleted cultures during chondrocyte differentiation and the role of m-calpain in the mineralization process. m-Calpain was demonstrated immunohistochemically in epiphyseal chondrocytes, and immunoreactive m-calpain content in cells increased with terminal differentiation into hypertrophic cells. Immunoblotting also showed the association of the increase in m-calpain in cell pellets and in cell culture medium with development of the culture. Ca 2+-dependent caseinolytic activities of m-calpain extracted from cell pellets and from the medium increased with chondrocyte differentiation, coincident with the increase in enzyme content. The inhibition of m-calpain by the addition of calpastatin, a specific inhibitor of calpain, caused suppression of matrix mineralization in pelleted cultures; the addition of E-64c, a specific inhibitor of cysteine proteinases, during the mineralization stage also caused a significant inhibition of the matrix mineralization. The addition of E-64c resulted in altered composition of proteoglycan monomers and aggregates in cell pellets and in suppression of mineral growth. These findings support an important role of cysteine proteinases, especially m-calpain, in the regulation of the cartilage mineralization process through proteoglycan degradation.