Natural extracellular matrices (ECMs) are viscoelastic and exhibit stress relaxation. However, hydrogels used as synthetic ECMs for three-dimensional (3D) culture are typically elastic. Here, we report a materials approach to tune the rate of stress relaxation of hydrogels for 3D culture, independently of the hydrogel’s initial elastic modulus, degradation, and cell-adhesion-ligand density. We find that cell spreading, proliferation, and osteogenic differentiation of mesenchymal stem cells (MSCs) are all enhanced in cells cultured in gels with faster relaxation. Strikingly, MSCs form a mineralized, collagen-1-rich matrix similar to bone in rapidly relaxing hydrogels with an initial elastic modulus of 17 kPa. We also show that the effects of stress relaxation are mediated by adhesion-ligand binding, actomyosin contractility and mechanical clustering of adhesion ligands. Our findings highlight stress relaxation as a key characteristic of cell–ECM interactions and as an important design parameter of biomaterials for cell culture.