Transforming growth factor beta (TGF-β) is a key factor mediating the intercellular crosstalk between the hematopoietic stem cells and their microenvironment. Here, we investigated the skeletal phenotype of transgenic mice expressing constitutively active TGF-β receptor type I under the control of Mx1-Cre ( mice). μCT analysis showed decreased cortical thickness, and cancellous bone volume in both femurs and mandibles. Histomorphometric analysis confirmed a decrease in cancellous bone volume due to increased osteoclast number and decreased osteoblast number. Primary osteoblasts showed decreased ALP and mineralization. Constitutive activation increased osteoclast differentiation. qPCR analysis showed that ratio, , , and were increased whereas , were decreased in femurs. Interestingly, , , and mRNA expression were reduced whereas ratio was increased in mandibles. Similarly, osteoclast-related genes were increased in osteoclasts whereas osteoblast-related genes were reduced in osteoblasts. Western blot analysis indicated that SMAD2 and SMAD3 phosphorylation was increased in osteoblasts, and SMAD3 phosphorylation was increased in osteoclasts. CTSK was increased while RUNX2 and PTCH1 was decreased in mice. Microindentation analysis indicated decreased hardness in mice. Our study indicated that mice were osteopenic by increasing osteoclast number and decreasing osteoblast number, possibly by suppressing Hedgehog signaling pathways.