The prognosis of parosteal osteosarcoma is better than any other malignant bone tumors, but there are many controversies in its treatment. We tried to evaluate the prognosis and the effectiveness of limb-salvage operation in the treatment of the parosteal osteosarcoma. We experienced 12 patients of conventional parosteal osteosarcoma(2 males and 10 females) from 1981 to 1991. The limb-salvage operations with wide resection margin were done in 8 patients(5 tumer prosthesis, 2 resection arthrodesis and 1 vascularized fibular transplantation), marginal en-bloc resection and amputation in 2 patients, respectively. The duration of mean follow up was 5 years and 9 months, ranging from 2 year-3 months to 11 years, except of the patient who died with metastasis 1 year 8 months after. The disease-free survival rate(DFSR) of all patients was 68% and that of the patients treated with limb-salvage operation was 88% at 7 years. The DFSR was 33% with marginal margin(3 cases) and 89% with wide margin(9 cases) at 7 years. The results were unsatisfactory in the conventional parosteal osteosarcoma treated with marginal resection. The limb-salvage operation with wide surgical margin was thought to be the treatment of choice.