Systems for gene transfer and silencing in human skeletal stem cells (hSSCs, also stromal or mesenchymal stem cells) are important for addressing critical issues in basic hSSC and skeletal biology and for developing gene therapy strategies for treatment of skeletal diseases. Whereas recent studies have shown the efficacy of lentiviral transduction for gene transfer in hSSCs in vitro, no study has yet proven that lentivector-transduced hSSCs retain their distinctive organogenic potential in vivo, as probed by in vivo transplantation assays. Therefore, in addition to analyzing the in vitro growth and differentiation properties of hSSCs transduced with advanced-generation lentivectors, we ectopically transplanted LV-eGFP-transduced hSSCs (along with an osteoconductive carrier) in the subcutaneous tissue of immunocompromised mice. eGFP-transduced cells formed heterotopic ossicles, generating osteoblasts, osteocytes, and stromal cells in vivo, which still expressed GFP at 2 months after transplantation. eGFP-expressing cells could be recovered from the ossicles 8 weeks posttransplantation and reestablished in culture as viable and proliferating cells. Further, we investigated the possibility of silencing individual genes in hSSCs using lentivectors encoding short hairpin precursors of RNA interfering sequences under the control of the Pol-III-dependent H1 promoter. Significant long-term silencing of both lamin A/C and GFP (an endogenous gene and a transgene, respectively) was obtained with lentivectors encoding shRNAs. These data provide the basis for analysis of the effect of gene knockdown during the organogenesis of bone in the in vivo transplantation system and for further studies on the silencing of alleles carrying dominant, disease-causing mutations.