It has been shown that the expression of DAN as well as Drm/Gremlin, a member of DAN/Cerberus family, is significantly down-regulated in rodent fibroblasts transformed with various oncogenes and overexpression of DAN results in the phenotypic reversion of the transformed phenotypes. In the present study, we examined the expression levels of DAN, BMP-2, BMP-4 and BMPRs (BMP receptors) in five human cell lines derived from bone and soft tissue tumors. Northern blot analysis revealed that DAN mRNA was detected in OS-KH and RMS-NK cells, but was not detectable in SAOS-2, NOS-1, and ASPS-KY cells. Transient overexpression of DAN in SAOS-2 cells, which lack, functional p53 and pRB, resulted in a remarkable growth suppression without the induction of p21(Waf1). Interestingly, overexpression of DAN was associated with a reduction of alkaline phosphatase activity in SAOS-2 cells. Stable transfection of DAN in SAOS-2 cells caused a significant reduction of numbers of drug-resistant colonies, whereas the truncated form of DAN which lacked a possible signal peptide, completely lost this capability. Our results suggest that the secreted form of DAN exerts its growth-suppressive function in SAGS-a cells in a p53-independent manner.