Osteoporosis is a common disease with a strong genetic component. We previously described a polymorphic Sp1 binding site in the COL1A1 gene that has been associated with osteoporosis in several populations. Here we explore the molecular mechanisms underlying this association. A meta-analysis showed significant associations between COL1A1 "s" alleles and bone mineral density (BMD), body mass index (BMI), and osteoporotic fractures. The association with fracture was stronger than expected on the basis of the observed differences in BMD and BMI, suggesting an additional effect on bone strength. Gel shift assays showed increased binding affinity of the "s" allele for Sp1 protein, and primary RNA transcripts derived from the "s" allele were approximately three times more abundant than "S" allele--derived transcripts in "Ss" heterozygotes. Collagen produced from osteoblasts cultured from "Ss" heterozygotes had an increased ratio of alpha 1(I) protein relative to alpha 2(I), and this was accompanied by an increased ratio of COL1A1 mRNA relative to COL1A2. Finally, the yield strength of bone derived from "Ss" individuals was reduced when compared with bone derived from "SS" subjects. We conclude that the COL1A1 Sp1 polymorphism is a functional genetic variant that predisposes to osteoporosis by complex mechanisms involving changes in bone mass and bone quality.