Growth and development of most parts of the vertebrate skeleton takes place by endochondral ossification, a process during which chondrocytes undergo distinct stages of differentiation resulting in a successive replacement of the cartilage anlagen by bone. In the context of an EST project we isolated a novel transcript from a human fetal growth plate cartilage cDNA library. The transcript which we called Ucma (unique cartilage matrix-associated protein) encodes a short protein of 138 amino acids. The protein sequence is evolutionary conserved throughout vertebrates and comprises a signal peptide, a coiled-coil domain, and a putative dibasic cleavage site for proprotein convertases. Using RNA in situ hybridization and immunohistochemistry with a polyclonal anti-Ucma antibody we found high expression of Ucma uniquely in distal (resting) chondrocytes in developing long bones of wildtype mice. This restricted expression could also be observed in Ihh^−/−, Ihh^−/−; Gli3^−/−, Gli3^−/− mice, and in mice that overexpress Ihh under the control of the Col2a1 promoter indicating that expression of Ucma is regulated independent of hedgehog signaling. During insulin-induced differentiation of ATDC5 cells we found gradual increase of Ucma expression at day 21 with a maximum at day 24 and a decrease correlating with a simultaneous increase in the expression of cartilage link protein (Crtl1), a protein with maximum expression in column-forming proliferating chondrocytes. The present data strongly suggest an important function of Ucma in the early phase of chondrocyte differentiation.