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BackgroundOsteosarcoma is the most common primary malignant bone tumor. The existing treatment regimens remained essentially unchanged over the past 30 years; hence the prognosis has plateaued at a poor level. Precise and personalized therapy is yet to be exploited.MethodsOne discovery cohort (n=98) and two validation cohorts (n=53 & n=48) were collected from public data sources. We performed a non-negative matrix factorization (NMF) method on the discovery cohort to stratify osteosarcoma. Survival analysis and transcriptomic profiling characterized each subtype. Then, a drug target was screened based on subtypes’ features and hazard ratios. We also used specific siRNAs and added a cholesterol pathway inhibitor to osteosarcoma cell lines (U2OS and Saos-2) to verify the target. Moreover, PermFIT and ProMS, two support vector machine (SVM) tools, and the least absolute shrinkage and selection operator (LASSO) method, were employed to establish predictive models.ResultsWe herein divided osteosarcoma patients into four subtypes (S-I ~ S-IV). Patients of S- I were found probable to live longer. S-II was characterized by the highest immune infiltration. Cancer cells proliferated most in S-III. Notably, S-IV held the most unfavorable outcome and active cholesterol metabolism. SQLE, a rate-limiting enzyme for cholesterol biosynthesis, was identified as a potential drug target for S-IV patients. This finding was further validated in two external independent osteosarcoma cohorts. The function of SQLE to promote proliferation and migration was confirmed by cell phenotypic assays after the specific gene knockdown or addition of terbinafine, an inhibitor of SQLE. We further employed two machine learning tools based on SVM algorithms to develop a subtype diagnostic model and used the LASSO method to establish a 4-gene model for predicting prognosis. These two models were also verified in a validation cohort.ConclusionThe molecular classification enhanced our understanding of osteosarcoma; the novel predicting models served as robust prognostic biomarkers; the therapeutic target SQLE opened a new way for treatment. Our results served as valuable hints for future biological studies and clinical trials of osteosarcoma.