Gaseous signaling molecules such as hydrogen sulfide (H2S) are produced endogenously and mediate effects through diverse mechanisms. H2S is one such gasotrasmitter which regulates multiple signaling pathways in mammalian cells, and abnormal H2S metabolism has been linked to defects in bone homeostasis. Here, we demonstrate that bone marrow mesenchymal stem cells (BMMSCs) produce H2S to regulate their self-renewal and osteogenic differentiation, and H2S deficiency results in defects in BMMSC differentiation. H2S deficiency causes aberrant intracellular Ca2+ influx, due to reduced sulfhydration of cysteine residues on multiple Ca2+ TRP channels. This decreased Ca2+ flux downregulates PKC/Erk-mediated Wnt/β-catenin signaling which controls osteogenic differentiation of BMMSCs. Consistently, H2S-deficient mice display an osteoporotic phenotype, which can be rescued by small molecules which release H2S. These results demonstrate H2S regulates BMMSCs, and restoring H2S levels via non-toxic donors may provide treatments for diseases such as osteoporosis which can arise from H2S deficiencies.