Osteocytes are derived from osteoblasts, but reside in the mineralized bone matrix under hypoxic conditions. Osteocyte-like cells show higher expression of ORP150, which is induced by hypoxia, than osteoblast-like cells. Accordingly, we hypothesized that the oxygen tension may regulate the transformation of osteoblasts to osteocytes. MC3T3-E1 cells and calvariae from 4-day-old mice were cultured under normoxic (20% O(2)) or hypoxic (5% O(2)) conditions. To investigate osteoblastic differentiation and tranformation to osteocytes, alizarin red staining was done and the expression of various factors was assessed. Hypoxic culture promoted the increased synthesis of mineralized matrix by MC3T3-E1 cells. Alkaline phosphatase activity was initially increased during hypoxic culture, but decreased during osteogenesis. Osteocalcin production was also increased by hypoxic culture, but decreased after mineralization. Furthermore, expression of Dmp1, Mepe, Fgf23, and Cx43, which are osteocyte-specific or osteocyte-predominant proteins, by MC3T3-E1 cells was greater under hypoxic than under normoxic conditions. In mouse calvarial cultures, the number of cells in the bone matrix and cells expressing Dmp1 and Mepe were increased by hypoxia. In MC3T3-E1 cell cultures, ORP150 expression was only detected in the mineralized nodules under normoxic conditions, while its expression was diffuse under hypoxic conditions, suggesting that the nodules were hypoxic zones even in normoxic cultures. These findings suggest that a low oxygen tension promotes osteoblastic differentiation and subsequent transformation to osteocytes.