Type XI collagen, a member of the group of fibrillar collagens, plays a regulatory role in the formation of the collagen fibril network in cartilage and consequently plays a pivotal role in the formation of the endochondral skeleton. The mechanism by which type XI collagen limits fibril growth appears to involve the large noncollagenous amino terminal domain. Complex alternative splicing occurs within this domain in two of the three constituent subunits, alpha1(XI) and alpha2(XI). In the alpha1(XI) chain, three alternatively spliced exons encoding one very basic and two very acidic peptides generate six spliceforms and protein isoforms. In order to better understand the significance of this alternative splicing, we have examined fetal rat cartilage to determine: (a) the relationship between alternative splicing and chondrogenesis in limb bud micromass culture; (b) the relative levels of expression of each of the splice-forms by ribonuclease protection; and (c) the distribution of splice-forms and protein isoforms by in situ hybridization and immunohistochemistry. The results indicate that the pattern of alternative splicing of the alpha1(XI) chain is tightly linked to chondrogenesis. The two most abundant spliceforms in fetal rib cartilage are v(o), lacking all three exons, and v1b, containing the exon encoding the basic peptide. While most of the spliceforms show a general distribution in nasal, Meckel's, and rib cartilage, v1b was restricted to the dorsal portion of the fetal rib. This distribution appears to correlate with the portion of the rib which will ultimately ossify, rather than with any of the differentiative states of chondrocytes. Together these results suggest that alternative splicing within the amino terminal domain of the alpha1(XI) chain may contribute to the function of type XI collagen and that expression of the basic v1b peptide may play a role in endochondral ossification.