Mesenchymal stem cells (MSCs) are multipotent cells that can be differentiated into osteoblasts and provide an excellent cell source for bone regeneration and repair. Recently, the canonical Wnt/beta-catenin signaling pathway has been found to play a critical role in skeletal development and osteogenesis, implying that Wnts can be utilized to improve de novo bone formation mediated by MSCs. However, it is unknown whether noncanonical Wnt signaling regulates osteogenic differentiation. Here, we find that Wnt-4 enhanced in vitro osteogenic differentiation of MSCs isolated from human adult craniofacial tissues and promoted bone formation in vivo. Whereas Wnt-4 did not stabilize beta-catenin, it activated p38 MAPK in a novel noncanonical signaling pathway. The activation of p38 was dependent on Axin and was required for the enhancement of MSC differentiation by Wnt-4. Moreover, using two different models of craniofacial bone injury, we found that MSCs genetically engineered to express Wnt-4 enhanced osteogenesis and improved the repair of craniofacial defects in vivo. Taken together, our results reveal that noncanonical Wnt signaling could also play a role in osteogenic differentiation. Wnt-4 may have a potential use in improving bone regeneration and repair of craniofacial defects.