Angiogenesis is essential for bone formation and several bone morphogenetic proteins (BMPs) have been shown to induce angiogenesis through osteoblast-derived vascular endothelial growth factor (VEGF)-A. Growth differentiation factor-5 (GDF-5) is a member of the BMP family expressed in bone and known to induce angiogenesis in vivo. In this study, the effects of GDF-5 on osteogenic differentiation and expression of VEGF-related genes were determined using rat bone marrow stromal cells. GDF-5 stimulated osteogenic differentiation. It also upregulated the expression of VEGF-A after 3 hr, accompanied by a trend of decrease in its receptor VEGFR-2 at 6 and 24 hr. VEGF-D and its receptor VEGFR-3 showed peak expression at later time points. This regulation may be further controlled by neuropilin 2 that exhibited a parallel profile to VEGF-D. These observations indicate that GDF-5 stimulates osteogenic differentiation and has a potential to induce angiogenesis through osteoblast-derived VEGF-A in bone.