The molecular cloning of bone gamma-carboxyglutamic acid (Gla) protein (BGP; osteocalcin) was accomplished by constructing a phage lambda gt11 cDNA library from the rat osteosarcoma cell line ROS 17/2 and screening this library with antibodies raised against BGP from rat bone. By sequencing several cloned cDNAs, we have established a 489-base-pair sequence that predicts a mature BGP of 50 amino acid residues with an NH2-terminal extension of 49 residues. The leader peptide consists of a hydrophobic signal peptide followed by a basic propeptide of 26 or 27 residues that is cleaved after an Arg-Arg dipeptide prior to secretion from the cell. Mature rat BGP is extremely homologous to BGPs from other species except for its COOH-terminal sequence. A stretch of 9 residues proximal to the NH2 terminus of secreted BGP is strikingly similar to the corresponding regions in known propeptides of the gamma-carboxyglutamic acid-containing blood coagulation factors. We suggest that this common structural feature may be involved in the posttranslational targeting of these polypeptides for vitamin K-dependent gamma-carboxylation.