Insulin receptor substrate-1 (IRS-1) is an essential molecule for intracellular signaling of insulin-like growth factor (IGF)-I and insulin, both of which are potent anabolic regulators of bone and cartilage metabolism. To investigate the role of IRS-1 in bone regeneration, fracture was introduced in the tibia, and its healing was compared between wild-type (WT) mice and mice lacking the IRS-1 gene (IRS-1(-/-) mice). Among 15 IRS-1(-/-) mice, 12 remained in a non-union state even at 10 weeks after the operation, whereas all 15 WT mice showed a rigid bone union at 3 weeks. This impairment was because of the suppression of callus formation with a decrease in chondrocyte proliferation and increases in hypertrophic differentiation and apoptosis. Reintroduction of IRS-1 to the IRS-1(-/-) fractured site using an adenovirus vector significantly restored the callus formation. In the culture of chondrocytes isolated from the mouse growth plate, IRS-1(-/-) chondrocytes showed less mitogenic ability and Akt phosphorylation than WT chondrocytes. An Akt inhibitor decreased the IGF-I-stimulated DNA synthesis of chondrocytes more potently in the WT culture than in the IRS-1(-/-) culture. We therefore conclude that IRS-1 deficiency impairs bone healing at least partly by inhibiting chondrocyte proliferation through the phosphatidylinositol 3-kinase/Akt pathway, and we propose that IRS-1 can be a target molecule for bone regenerative medicine.