BACKGROUND: Chondrosarcomas are malignant cartilage tumors that do not respond to traditional chemotherapy or radiation. The 5-year survival rate of histologic grade III chondrosarcoma is less than 30%. An animal model of chondrosarcoma has been established--namely, the Swarm Rat Chondrosarcoma (SRC)--and shown to resemble the human disease. Previous studies with this model revealed that tumor microenvironment could significantly influence chondrosarcoma malignancy. METHODS: To examine the effect of the microenvironment, SRC tumors were initiated at different transplantation sites. Pyrosequencing assays were utilized to assess the DNA methylation of the tumors, and SAGE libraries were constructed and sequenced to determine the gene expression profiles of the tumors. Based on the gene expression analysis, subsequent functional assays were designed to determine the relevancy of the specific genes in the development and progression of the SRC. RESULTS: The site of transplantation had a significant impact on the epigenetic and gene expression profiles of SRC tumors. Our analyses revealed that SRC tumors were hypomethylated compared to control tissue, and that tumors at each transplantation site had a unique expression profile. Subsequent functional analysis of differentially expressed genes, albeit preliminary, provided some insight into the role that thymosin-beta4, c-fos, and CTGF may play in chondrosarcoma development and progression. CONCLUSION: This report describes the first global molecular characterization of the SRC model, and it demonstrates that the tumor microenvironment can induce epigenetic alterations and changes in gene expression in the SRC tumors. We documented changes in gene expression that accompany changes in tumor phenotype, and these gene expression changes provide insight into the pathways that may play a role in the development and progression of chondrosarcoma. Furthermore, specific functional analysis indicates that thymosin-beta4 may have a role in chondrosarcoma metastasis.