We have recently shown that TNF-related weak inducer of apoptosis (TWEAK) is a mediator of inflammatory bone remodeling. The aim of this study was to investigate the role of TWEAK in modulating human osteoblast activity, and how TWEAK and TNFalpha might interact in this context. Recombinant TWEAK and TNF were both mitogenic for human primary osteoblasts (NHBC). TWEAK dose- and time-dependently regulated the expression of the osteoblast transcription factors RUNX2 and osterix. TWEAK inhibited in vitro mineralization and downregulated the expression of osteogenesis-associated genes. Significantly, TWEAK and TWEAK/TNF induced the expression of the osteoblast differentiation inhibitor and SOST gene product, sclerostin. Sclerostin induction was mitogen-activated protein kinase (MAPK) dependent. The SOST mRNA levels induced by TWEAK were equivalent to or exceeded those seen in steady-state human bone, and the TWEAK/TNF induction of SOST mRNA was recapitulated in fresh cancellous bone explants. TWEAK-induced sclerostin expression was observed in immature osteoblastic cells, both in cycling (Ki67(+)) primary NHBC and in the cell lines MC3T3-E1 and MG-63, as well as in human osteocyte-like cells and in the osteocyte cell line, MLO-Y4. Treatment of NHBC with recombinant human sclerostin mimicked the effects of TWEAK to suppress RUNX2 and osteocalcin (OCN). TWEAK, TNF, and sclerostin treatment of NHBC similarly altered levels of phosphorylated and total GSK3beta and active and total levels of beta-catenin, implying that the Wnt signaling pathway was affected by all three stimuli. Sclerostin also rapidly activated ERK-1/2 MAPK signaling, indicating the involvement of additional signaling pathways. Together, our findings suggest that TWEAK, alone and with TNF, can regulate osteoblast function, at least in part by inducing sclerostin expression. Our results also suggest new roles and modes of action for sclerostin.