Previous work has indicated that signals from the floor plate and notochord promote chondrogenesis of the somitic mesoderm. These tissues, acting through the secreted signaling molecule Sonic hedgehog (Shh), appear to be critical for the formation of the sclerotome. Later steps in the differentiation of sclerotome into cartilage may be independent of the influence of these axial tissues. Although the signals involved in these later steps have not yet been pinpointed, there is substantial evidence that the analogous stages of limb bud chondrogenesis require bone morphogenetic protein (BMP) signaling. We show here that presomitic mesoderm (psm) cultured in the presence of Shh will differentiate into cartilage, and that the later stages of this differentiation process specifically depend on BMP signaling. We find that Shh not only acts in collaboration with BMPs to induce cartilage, but that it changes the competence of target cells to respond to BMPs. In the absence of Shh, BMP administration induces lateral plate gene expression in cultured psm. After exposure to Shh, BMP signaling no longer induces expression of lateral plate markers but now induces robust chondrogenesis in cultured psm. Shh signals are required only transiently for somitic chondrogenesis in vitro, and act to provide a window of competence during which time BMP signals can induce chondrogenic differentiation. Our findings suggest that chondrogenesis of somitic tissues can be divided into two separate phases: Shh-mediated generation of precursor cells, which are competent to initiate chondrogenesis in response to BMP signaling, and later exposure to BMPs, which act to trigger chondrogenic differentiation.

Little is known about the genesis and patterning of tendons and other connective tissues, mostly owing to the absence of early markers. We have found that Scleraxis, a bHLH transcription factor, is a highly specific marker for all the connective tissues that mediate attachment of muscle to bone in chick and mouse, including the limb tendons, and show that early scleraxis expression marks the progenitor cell populations for these tissues. In the early limb bud, the tendon progenitor population is found in the superficial proximomedial mesenchyme. Using the scleraxis gene as a marker we show that these progenitors are induced by ectodermal signals and restricted by bone morphogenetic protein (BMP) signaling within the mesenchyme. Application of Noggin protein antagonizes this endogenous BMP activity and induces ectopic scleraxis expression. However, the presence of excess tendon progenitors does not lead to the production of additional or longer tendons, indicating that additional signals are required for the final formation of a tendon. Finally, we show that the endogenous expression of noggin within the condensing digit cartilage contributes to the induction of distal tendons.

Previously, we demonstrated that Shh acts early in the development of the axial skeleton, to induce a prochondrogenic response to later BMP signaling. Here, we demonstrate that somitic expression of the transcription factor Nkx3.2 is initiated by Shh and sustained by BMP signals. Misexpression of Nkx3.2 in somitic tissue confers a prochondrogenic response to BMP signals. The transcriptional repressor activity of Nkx3.2 is essential for this factor to promote chondrogenesis. Conversely, a "reverse function" mutant of Nkx3.2 that has been converted into a transcriptional activator inhibits axial chondrogenesis in vivo. We conclude that Nkx3.2 is a critical mediator of the actions of Shh during axial cartilage formation, acting to inhibit expression of factors that interfere with the prochondrogenic effects of BMPs.

Research on Alzheimer's disease led to the identification of a novel proteolytic mechanism in all metazoans, the presenilin/␥-secretase complex. This unique intramembrane-cleaving aspartyl protease is required for the normal processing of Notch, Jagged, ␤-amyloid precursor protein (APP), E-cadherin, and many other receptor-like proteins. We recently provided indirect evidence of ␥-secretase activity at the cell surface in HeLa cells following inhibition of receptor-mediated endocytosis. Here, we directly identify and isolate ␥-secretase as an intact complex (Presenilin, Nicastrin, Aph-1, and Pen-2) from the plasma membrane, both in overexpressing cell lines and endogenously. Inhibition of its proteolytic activity allowed cell surface ␥-secretase to be captured in association with its plasma membranelocalized APP substrates (C83 and C99). Moreover, non-denaturing isolation of the intact enzyme complex revealed that cell surface ␥-secretase can specifically generate amyloid ␤-protein from an APP substrate and similarly cleave a Notch substrate. These data directly establish the proteolytic function of ␥-secretase on the plasma membrane, independent of a hypothesized substrate trafficking role. We conclude that presenilin/ ␥-secretase exists as a mature complex at the cell surface, where it interacts with and can cleave its substrates, consistent with an essential function in processing many adhesion molecules and receptors required for cell-cell interaction or intercellular signaling.