The cellular and molecular mechanisms that underlie age-dependent osteoporosis, the most common disease in the Western Hemisphere, are poorly understood in part due to the lack of appropriate animal models in which to study disease progression. Here, we present a model that shows many similarities to the human disease. Sca-1, well known for its expression on hematopoietic stem cells, is present on a subset of bone marrow stromal cells, which potentially include mesenchymal stem cells. Longitudinal studies showed that Sca-1^−/− mice undergo normal bone development but with age exhibit dramatically decreased bone mass resulting in brittle bones. In vivo and in vitro analyses demonstrated that Sca-1 is required directly for the self-renewal of mesenchymal progenitors and indirectly for the regulation of osteoclast differentiation. Thus, defective mesenchymal stem or progenitor cell self-renewal may represent a previously uncharacterized mechanism of age-dependent osteoporosis in humans.