Matrix vesicles (MVs) are extracellular, 100 nM in diameter, membrane-invested particles selectively located at sites of initial calcification in cartilage, bone, and predentin. The first crystals of apatitic bone mineral are formed within MVs close to the inner surfaces of their investing membranes. Matrix vesicle biogenesis occurs by polarized budding and pinching-off of vesicles from specific regions of the outer plasma membranes of differentiating growth plate chondrocytes, osteoblasts, and odontoblasts. Polarized release of MVs into selected areas of developing matrix determines the nonrandom distribution of calcification. Initiation of the first mineral crystals, within MVs (phase 1), is augmented by the activity of MV phosphatases (eg, alkaline phosphatase, adenosine triphosphatase and pyrophosphatase) plus calcium-binding molecules (eg, annexin I and phosphatidyl serine), all of which are concentrated in or near the MV membrane. Phase 2 of biologic mineralization begins with crystal release through the MV membrane, exposing preformed hydroxyapatite crystals to the extracellular fluid. The extracellular fluid normally contains sufficient Ca2+ and PO4(3-) to support continuous crystal proliferation, with preformed crystals serving as nuclei (templates) for the formation of new crystals by a process of homologous nucleation. In diseases such as osteoarthritis, crystal deposition arthritis, and atherosclerosis, MVs initiate pathologic calcification, which, in turn, augments disease progression.