Somatic gene therapies require targeted transfer of the therapeutic gene(s) into stem cells that proliferate and then differentiate and express the gene in a tissue-restricted manner. We have developed an approach for gene therapy using marrow cells that takes advantage of the osteoblast specificity of the osteocalcin promoter to confine expression of chimeric genes to bone. Adherent marrow cells, carrying a reporter gene [chloramphenicol acetyltransferase (CAT)] under the control of a 1.7-kilobase rat osteocalcin gene promoter, were expanded ex vivo. After transplantation by intravenous infusion, engrafted donor cells in recipient mice were detected by the presence of the transgene in a broad spectrum of tissues. However, expression of the transgene was restricted to osteoblasts and osteocytes, as established by biochemical analysis of CAT activity and immunohistochemical analysis of CAT expression at the single cell level. Our data indicate that donor cells achieved long-term engraftment in various tissues of the recipients and that the CAT gene under control of the osteocalcin promoter is expressed specifically in bone. Thus, transplantation of multipotential marrow cells containing the osteocalcin promoter-controlled transgene provides an efficacious approach to deliver therapeutic gene expression to osteoblasts for treatment of bone disorders or tumor metastasis to the skeleton.