Prolonged systemic administration of corticosteroids causes osteoporosis and increased risk of fracture. Despite this well documented side effect of systemic corticosteroids, the effect of these compounds on fracture healing is not well defined. The goal of this study was to test the hypothesis that systemic corticosteroid therapy adversely affects fracture healing in a rabbit ulnar osteotomy model. Non-critical sized (1 mm) defects were created bilaterally in 18 adult female New Zealand White rabbits. Starting 2 months before operative intervention and continuing for 6 weeks during healing of the osteotomies, a subcutaneous dose of either sterile saline or prednisone (0.15 mg/kg) was administered daily. Serial radiographs of the forelimb were taken immediately postoperatively and weekly beginning the second week postoperatively. After killing at 6 weeks, only 3 of 20 limbs from animals treated with prednisone achieved radiographic union while 13 of 16 control limbs achieved union. The radiographic density of bone in the defect as well as callus size were greater in the control limbs than in the limbs from prednisone-treated animals. DEXA confirmed that the bone mineral content was lower in the ulnae of prednisone-treated rabbits both within the defect and in adjacent ulnar bone. Mechanical data indicated that osteotomies from rabbits chronically treated with prednisone were weaker than in controls. In this rabbit ulnar osteotomy model, chronic prednisone treatment clearly inhibited bone healing.