The niche is a conserved regulator of stem cell quiescence and function. During ageing, stem cell function declines. To what extent and by what means age-related changes within the niche contribute to this phenomenon are unknown. Here we demonstrate that the aged muscle stem cell niche, the muscle fibre, expresses Fgf2 under homeostatic conditions, driving a subset of satellite cells to break quiescence and lose their self-renewing capacity. We show in mice that relatively dormant aged satellite cells robustly express sprouty 1 (Spry1), an inhibitor of fibroblast growth factor (FGF) signalling. Increasing FGF signalling in aged satellite cells under homeostatic conditions by removing Spry1 results in the loss of quiescence, satellite cell depletion and diminished regenerative capacity. Conversely, reducing niche-derived FGF activity through inhibition of Fgfr1 signalling or overexpression of Spry1 in satellite cells prevents their depletion. These experiments identify an age-dependent change in the stem cell niche that directly influences stem cell quiescence and function.