Interaction between cultured endothelial cells (EC) and pericytes (PC) was studied in vitro to clarify the mechanism of diabetic proliferative retinopathy. Conditioned medium (CM) from retinal PC strongly increased the proliferation and moderately stimulated migration of retinal EC. Moreover, CM from PC caused stimulation of angiogenesis of retinal EC and umbilical cord vein EC in vitro at the same extent as basic fibroblast growth factor (bFGF). PC also stimulated angiogenesis by EC in mixed cultures. The angiogenic, proliferative and migration activities in CM from PC were inhibited by an antibody to bFGF. These data suggest that PC play an important role in angiogenesis through secretion of an FGF-like molecule.