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In the present study, we prepared lipid-coated basic-fibroblast growth factor (b-FGF) and evaluated its tissue response. The lipid, didodecyl N-D-glucono-L-glutamate (2C12-Glu) was prepared from didodecyl L-glutamate and D-glucono-1, 5-lactone, and the lipid-coated b-FGF was prepared from the mixing reaction of 2C12-Glu in dioxane solution and b-FGF in phosphate-buffered saline solution. After centrifugation and freeze drying, liplid-coated b-FGF was obtained as a white substance. The lipid-coated b-FGF was insoluble in water or any aqueous buffer solution, but freely soluble in most organic solvent. Ultraviolet spectra measurement of lipid-coated b-FGF between 250-300nm indicated that 15% of b-FGF was coated with lipid. Circular dichroism spectroscopy measurement confirmed that the conformation of b-FGF was maintained in organic solvent after lipid-coating. The lipid-coated b-FGF or lipid (2C12-Glu) alone was implanted in the tibia of rats. After 2 weeks of implantation, histological observation revealed that the lipid-coated b-FGF induced the new bone formation faster than lipid (2C12-Glu) alone. In conclusion, lipid-coated b-FGF will be useful for bone regeneration in drug delivery system or tissue engineering.