The maintenance of stable bone mass during adult life, following rapid skeletal growth during childhood, is the result of a carefully controlled balance between the activities of bone forming (osteoblast) and bone resorbing (osteoclast) cells. Although skeletal turnover continues throughout adult life, the net effect of formation and resorption on bone mass is zero in healthy individuals. Later in life, bone mass begins to fall as resorption outpaces formation, particularly in post-menopausal women, which leads to increased fracture risk. The opposing actions of these two cell types are coupled by molecular interactions between them that are thought to be influenced by the actions of the precursor cells of the osteoblast lineage, mesenchymal stem cells (MSCs). In addition to regulating normal skeletal homeostasis, MSCs also play an important role in fracture repair. Bone fracture or injury initiates a series of cellular and molecular pathways that commence with hematoma formation and an inflammatory cascade that regulates MSCs activity leading to fracture healing and the reestablishment of skeletal integrity. Although tremendous strides have been made in increasing our understanding of bone biology, there is surprisingly little data about the role of MSCs in vivo in the maintenance of skeletal integrity or fracture repair. In recent years, the pivotal importance of anabolic therapies in the setting of osteoporosis in which bone mass is substantially increased above and beyond what is attainable with the bisphosphonate class of drugs has put MSC biology firmly on the scientific agenda. Although the biology of cultured MSCs is reasonably well understood, the biology of MSCs in vivo in both bone turnover and fracture repair remains poorly understood. The recent phenotypic characterization of in vivo MSCs and the ability to prospectively purify such cells will open up new avenues of research into a better understanding of the role of MSCs in bone turnover. The purpose of this article is to review bone and fracture biology from the perspective of recent advances in our understanding of MSCs and to highlight the major deficiencies in our current knowledge.