Bone marrow transplantation (BMT) has changed the course of treatment for an array of diseases, including disorders of bone. Hematopoietic stem cells (HSC) within the marrow are known to be the precursors of osteoclastic bone cells, and trials of BMT in osteopetrosis, a disorder characterized by a deficiency of osteoclasts, have resulted in significant clinical improvement in patients. The origin of the other major bone cell, the osteoblast, remains uncertain, although studies have identified osteoprogenitor cells within the marrow, leading to further investigation of both mesenchymal stromal cells (MSC) and HSC as candidates for this role. A better understanding of the source of osteoblasts and normal bone metabolism is crucial to efforts to develop effective cell therapy for bone disorders characterized by deficient or abnormal osteoblast function. This review focuses on systemic and local cell therapy in the treatment of several genetic bone disorders and osteoporosis, an acquired disorder caused by abnormal bone metabolism, with the intent of presenting both the progress and challenges associated with this emerging form of therapy. Although the risks of systemic transplantation must be carefully considered, cell therapy for disorders of bone carries the potential for long-term and potentially curative benefits, justifying further intensive research on this important treatment option.