Osteocalcin, a bone-specific protein and marker of the mature osteoblast, is expressed only in nonproliferating osteoblasts in a mineralizing extracellular matrix, while type I collagen is expressed in proliferating cells. The nuclear proteins encoded by the c-fos and c-jun protooncogenes are expressed during the proliferation period of osteoblast phenotype development. We present evidence that AP-1 (HeLa cell-activating protein 1) sites residing within two promoter elements of the osteocalcin gene bind the Fos-Jun protein complex: the osteocalcin box (OC box; nucleotides -99 to -76), which contains a CCAAT motif as a central element and influences tissue-specific basal levels of osteocalcin gene transcription, and the vitamin D-responsive element (VDRE; nucleotides -462 to -440), which mediates enhancement of osteocalcin gene transcription. Gel electrophoretic mobility-shift analysis demonstrated high AP-1 binding activity in proliferating osteoblasts and dramatic changes in this activity after the down-regulation of proliferation and the initiation of extracellular-matrix mineralization in primary cultures of normal diploid osteoblasts. Methylation interference analysis established at single nucleotide resolution that purified recombinant Fos and Jun proteins bind in a sequence-specific manner to the AP-1 sites within the VDRE and OC box. Similarly, an AP-1 motif within a putative VDRE of the alkaline phosphatase gene, which is also expressed after the completion of proliferation, binds the Fos-Jun complex. These results support a model in which coordinate occupancy of the AP-1 sites in the VDRE and OC box in proliferating osteoblasts may suppress both basal level and vitamin D-enhanced osteocalcin gene transcription as well as transcription of other genes associated with osteoblast differentiation--a phenomenon we describe as phenotype suppression. This model is further supported by binding of the Fos-Jun complex at an AP-1 site in the type alpha I collagen promoter that is contiguous with, but not overlapping, the VDRE. Such a sequence organization in the collagen VDRE motif is compatible with vitamin D modulation of collagen but not with osteocalcin and alkaline phosphatase expression in proliferating osteoblasts.