Hereditary multiple exostoses (HME), a dominantly inherited disorder characterized by multiple cartilaginous tumors, is caused by mutations in the gene for, EXT1 or EXT2. Recent studies have revealed that EXT1 and EXT2 are required for the biosynthesis of heparan sulfate and exert maximal transferase activity as a complex. The Drosophila homologue of EXT1 (tout-velu) regulates the movement and signaling of Hedgehog protein, which plays an important role in the regulation of chondrocyte differentiation and bone development. In this study, to investigate the biological role of EXT2 in bone development in vivo and the pathological role of HME mutations in the development of exostoses, we generated transgenic mice expressing EXT2 or mutant EXT2 in developing chondrocytes. Histological analyses and micro-CT scanning showed that the biosynthesis of heparan sulfate and the formation of trabeculae were upregulated in EXT2-transgenic mice, but not in mutant EXT2-transgenic mice. The expression of EXT1 is concomitantly upregulated in EXT2-transgenic and even mutant EXT2-transgenic mice, suggesting an interactive regulation of EXT1 and EXT2 expression. These findings support that the EXT2 gene encodes an essential component of the glycosyltransferase complex required for the biosynthesis of heparan sulfate, which may eventually modulate the signaling involved in bone formation. (C) 2002 Elsevier Science (USA).