Although the primary cell type in human osteosarcoma is usually a neoplastic osteoblast, numerous other mesenchymal cell types may coexist in the same tumor. Previously described cloned, long-term osteosarcoma cell lines have had an osteoblastic phenotype. In this report, we describe a nonosteoblastic, long-term cell line derived from an osteosarcoma in a patient with Paget's disease. The cell line (FM-2) is nontransformed in having a low saturation density and anchorage-dependent growth, and it is nontumorigenic in nude mice. Important features of its fine structure include numerous elongated mitochondria, abundant Golgi and lysosomes, and a poorly developed rough endoplasmic reticulum. The line has high levels of lysosomal enzymes (acid phosphatase and N-acetylglucosaminidase) and low levels of alkaline phosphatase. It lacks numerous macrophage markers (lysozyme, C3, Fc receptors, and M1 antigen). The FM-2 line had a dose-dependent cyclic AMP response (7-fold increase) following treatment with calcitonin but not with parathormone. In 125I-calcitonin-binding experiments, we calculated approximately 5.3 +/- 0.2 X 10(3) receptor sites/cell with a kd of 1.8 +/- 0.1 X 10(-9) M. Conditioned medium from the FM-2 line was a potent stimulator of calcium release as assayed in a 45Ca-labeled fetal rat bone organ culture. This activity was not prostaglandin, vitamin D, parathormone, or epidermal growth factor, which are known stimulators of bone resorption. The FM-2 line does not appear to be derived from an osteoblast, macrophage, or fibroblast and may represent a calcitonin-responsive bone stem cell.