RATIONALE Diabetes mellitus is frequently complicated by cardiovascular disease, such as vascular calcification and endothelial dysfunction, which have been associated with bone morphogenetic proteins (BMPs). OBJECTIVE To determine whether hyperglycemia in vitro and diabetes in vivo promote vascular BMP activity and correlate with vascular calcification. METHODS AND RESULTS Increased glucose augmented expression of BMP-2 and BMP-4; the BMP inhibitors matrix Gla protein (MGP) and Noggin; activin-like kinase receptor (ALK)1, -2, -3 and -6; the BMP type 2 receptor; and the vascular endothelial growth factor in human aortic endothelial cells (HAECs). Diabetes induced expression of the same factors in the aortic wall of 3 animal models of diabetes, Ins2(Akita/+) mice, db/db mice, and HIP rats (rats transgenic for human islet amyloid polypeptide), representative of types 1 and 2 diabetes. Conditioned media from glucose-treated HAECs increased angiogenesis in bovine aortic endothelial cells, as mediated by BMP-4, and osteogenesis in calcifying vascular cells, as mediated by BMP-2. BMP-4, MGP, ALK1, and ALK2 were predominantly expressed on the endothelial side of the aorta, and small interfering RNA experiments showed that these genes were regulated as a group. Diabetic mice and rats showed a dramatic increase in aortic BMP activity, as demonstrated by SMAD1/5/8 phosphorylation. This was associated with increased osteogenesis and calcium accumulation. These changes were prevented in the Ins2(Akita/+) mice by breeding them with MGP transgenic mice, which increased aortic BMP inhibition. CONCLUSIONS Hyperglycemia and diabetes activate vascular BMP activity, which is instrumental in promoting vascular calcification and may be limited by increasing BMP inhibition.