Treatment of localized osteosarcoma with amputation alone has historically resulted in long-term relapse-free survival of approximately 20%, although relapse-free survival of greater than 40% has been reported in surgically-treated patients in one institution. The objective of this multi-institutional study was to evaluate the efficacy of adjuvant chemotherapy using the currently available front-line drugs in children with localized extremity osteosarcoma. Following either amputation or limb salvage procedure, patients were randomized to receive either a 43-week course of chemotherapy using bleomycin/actinomycin D/cyclophosphamide, high-dose methotrexate, adriamycin and cis-platinum (regimen 1), or no immediate chemotherapy (regimen 2). Patients being observed on regimen 2 received chemotherapy only in the event of overt tumor recurrence, following attempt at surgical resection of all recurent tumor. Since May, 1982, 36 eligible patients were randomized on this study (16 from NIC), 18 to the immediate chemotherapy arm and 18 to the observation arm. An additional 77 patients refused randomization of whom 59 elected adjuvant chemotherapy and 18 elected observation alone. Analyzing the randomized group by assigned arm there is a statistically significant difference in time to first relapse favoring the immediate chemotherapy group (p less than 0.001, 2-sided log rank test), the 2 year actuarial relapse-free survival being 17% for the observation arm and 64% for the chemotherapy arm. Analysis of the nonrandomized patients shows similar results. As yet there is no survival difference between the two arms. Thus, the administration of adjuvant chemotherapy has a significantly favorable impact on relapse-free survival. A new study addressing the role preoperative ("neo-adjuvant") chemotherapy in localized osteosarcoma is currently being formulated.