Bone-forming cells originate from distinct embryological layers, mesoderm (axial and appendicular bones) and ectoderm (precursor of neural crest cells, which mainly form facial bones). These cells will develop bones by two principal mechanisms: intramembranous and endochondral ossification. In both cases, condensation of multipotent mesenchymal cells occurs, at the site of the future bone, which differentiate into bone and cartilage-forming cells. During long bone development, an initial cartilaginous template is formed and replaced by bone in a coordinated and refined program involving chondrocyte proliferation and maturation, vascular invasion, recruitment of adult stem cells and intense remodeling of cartilage and bone matrix. Matrix metalloproteinases (MMPs) are the most important enzymes for cleaving structural components of the extracellular matrix (ECM), as well as other non-ECM molecules in the ECM space, pericellular perimeter and intracellularly. Thus, the bioactive molecules generated act on several biological events, such as development, tissue remodeling and homeostasis. Since the discovery of collagenase in bone cells, more than half of the MMP members have been detected in bone tissues under both physiological and pathological conditions. Pivotal functions of MMPs during development and bone regeneration have been revealed by knockout mouse models, such as chondrocyte proliferation and differentiation, osteoclast recruitment and function, bone modeling, coupling of bone resorption and formation (bone remodeling), osteoblast recruitment and survival, angiogenesis, osteocyte viability and function (biomechanical properties); as such alterations in MMP function may alter bone quality. In this review, we look at the principal properties of MMPs and their inhibitors (TIMPs and RECK), provide an up-date on their known functions in bone development and remodeling and discuss their potential application to Bone Bioengineering.