SULF1/SULF2 enzymes regulate cell signalling that impacts the growth and differentiation of many tissues. To determine their possible role in cartilage and bone growth or repair, their expression was examined during development and bone fracture healing using RT-PCR and immunochemical analyses. Examination of epiphyseal growth plates revealed differential, inverse patterns of SULF1 and SULF2 expressions, with the former enriched in quiescent and the latter in hypertrophic chondrocyte zones. Markedly higher levels of both SULFs, however, were expressed in osteoblasts actively forming bone when compared with proliferating pre-osteoblasts in the periosteum or the entombed osteocytes which express the lowest levels. The increased expression of Sulf1 and Sulf2 in differentiating osteoblasts was further confirmed by RT-PCR analysis of mRNA levels in rat calvarial osteoblast cultures. SULF1 and SULF2 were expressed in most foetal articular chondrocytes but down-regulated in a larger subset of cells in the post-natal articular cartilage. Unlike adult articular chondrocytes, SULF1/SULF2 expression varied markedly in post-natal hypertrophic chondrocytes in the growth plate, with very high SULF2 expression compared with SULF1 apparent during neonatal growth in both primary and secondary centres of ossification. Similarly, hypertrophic chondrocytes expressed greatly higher levels of SULF2 but not SULF1 during bone fracture healing. SULF2 expression unlike SULF1 also spread to the calcifying matrix around the hypertrophic chondrocytes indicating its possible ligand inhibiting role through HSPG desulphation. Higher levels of SULF2 in both developing and healing bone closely correlated with parallel increases in hedgehog signalling analysed by ptc1 receptor expression.