The remodeling of chromatin is required for tissue-specific gene activation to permit interactions of transcription factors and co-regulators with their cognate elements. Here, we investigate the chromatin mediated mechanisms by which the bone-specific osteocalcin gene is transcriptionally activated during cessation of cell growth in ROS 17/2.8 osteosarcoma cells and during normal osteoblast differentiation. Acetylation of histones H3 and H4 at the osteocalcin (OC) gene promoter was assayed during the proliferative and post-proliferative stages of cell growth by using chromatin immunoprecipitation (ChIP) assays with antibodies that recognize different acetylated forms of histones H3 or H4. The results show that the promoter and coding regions of the OC gene contain very low levels of acetylated histones H3 and H4 during the proliferative period of osteoblast differentiation when the OC gene is inactive. Active expression of the OC gene in mature osteoblasts and confluent ROS 17/2.8 cells is functionally linked to preferential acetylation of histone H4 and to a lesser extent to acetylation of histone H3. Histone acetylation at the loci for RUNX2 (CBFA1), alkaline phosphatase, bone sialoprotein, osteopontin and the cell growth regulator p21 which are expressed throughout osteoblast differentiation, is not altered post-proliferatively. We conclude that acetylation of histones H3 and H4 is functionally coupled to the chromatin remodeling events that mediate the developmental induction of OC gene transcription in bone cells.