Coordinated proliferation and differentiation of growth plate chondrocytes controls endochondral bone growth and final height in humans, and disruption of this process results in diseases of the growing and adult skeleton, such as chondrodysplasias or osteoarthritis. We had shown recently that chondrocyte-specific deletion of the gene Rac1 in mice leads to severe dwarfism due to reduced chondrocyte proliferation, but the molecular pathways involved remained unclear. Here, we demonstrate that Rac1-deficient chondrocytes have severely reduced levels of inducible nitric oxide synthase (iNOS) protein and nitric oxide (NO) production. NO donors reversed the proliferative effects induced by Rac1 deficiency, whereas inhibition of NO production mimicked the effects of Rac1 loss of function. Examination of the growth plate of iNOS-deficient mice revealed reduced chondrocyte proliferation and expression of cyclin D1, resembling the phenotype of Rac1-deficient growth plates. Finally, we demonstrate that Rac1-NO signaling inhibits the expression of ATF3, a known suppressor of cyclin D1 expression in chondrocytes. In conclusion, our studies identify the iNOS-NO pathway as a novel mediator of mitogenic Rac1 signaling and indicate that it could be a target for growth disorder therapies. © 2011.