CDMP-3/GDF-7/BMP-12 treatment of pluripotent mesenchymal C3H10T1/2 cells resulted in a dose- and time-dependent change in cell morphology and in the expression of alkaline phosphatase, mRNA expression of osteocalcin, and bone sialoprotein, as well as mineralized bone nodule formation. CDMP-3 also stimulated Alcian Blue staining indicative of extracellular matrix formation without affecting aggrecan expression. CDMP-3 downregulated mRNA expression of BMP-4 and BMP-8A. CDMP-3 stimulated mRNA expression of ALK-1, ALK-2(ActR-IA), ALK-3(BMPR-IA), and ALK-4 without affecting that of ALK-6(BMPR-IB), ALK-7, and BMPR-II. These findings suggest that, under the experimental conditions studied, CDMP-3 induces the pluripotent mesenchymal C3H10T1/2 cells to express both chondrocytic and osteoblastic markers. The results further reveal potential complex interplay between the different bone morphogenetic proteins and their receptors in these processes.