Growth hormone (GH) regulates many of the factors responsible for controlling the development of bone marrow progenitor cells (BMPCs). The aim of this study was to elucidate the role of GH in osteogenic differentiation of BMPCs using GH receptor null mice (GHRKO). BMPCs from GHRKO and their wild-type (WT) littermates were quantified by flow cytometry and their osteogenic differentiation in vitro was determined by cell morphology, real-time RT-PCR, and biochemical analyses. We found that freshly harvested GHRKO marrow contains 3% CD34 (hematopoietic lineage), 43.5% CD45 (monocyte/macrophage lineage), and 2.5% CD106 positive (CFU-F/BMPC) cells compared to 11.2%, 45%, and 3.4% positive cells for (WT) marrow cells, respectively. When cultured for 14 days under conditions suitable for CFU-F expansion, GHRKO marrow cells lost CD34 positivity, and were markedly reduced for CD45, but 3- to 4-fold higher for CD106. While WT marrow cells also lost CD34 expression, they maintained CD45 and increased CD106 levels by 16-fold. When BMPCs from GHRKO mice were cultured under osteogenic conditions, they failed to elongate, in contrast to WT cells. Furthermore, GHRKO cultures expressed less alkaline phosphatase, contained less mineralized calcium, and displayed lower osteocalcin expression than WT cells. However, GHRKO cells displayed similar or higher expression of cbfa-1, collagen I, and osteopontin mRNA compared to WT. In conclusion, we show that GH has an effect on the proportions of hematopoietic and mesenchymal progenitor cells in the bone marrow, and that GH is essential for both the induction and later progression of osteogenesis.