Adequate recovery of hematopoietic stem cell (HSC) niches after cytotoxic conditioning regimens is essential to successful bone marrow transplantation. Yet, very little is known about the mechanisms that drive the restoration of these niches after bone marrow injury. Here we describe a profound disruption of the marrow microenvironment after lethal total body irradiation of mice that leads to the generation of osteoblasts restoring the HSC niche, followed by a transient, reversible expansion of this niche. Within 48 hours after irradiation, surviving host megakaryocytes were observed close to the endosteal surface of trabecular bone rather than in their normal parasinusoidal site concomitant with an increased stromal-derived factor-1 level. A subsequent increase in 2 megakaryocyte-derived growth factors, platelet-derived growth factor-beta and basic fibroblast growth factor, induces a 2-fold expansion of the population of N-cadherin-/osteopontin-positive osteoblasts, relative to the homeostatic osteoblast population, and hence, increases the number of potential niches for HSC engraftment. After donor cell engraftment, this expanded microenvironment reverts to its homeostatic state. Our results demonstrate the rapid recovery of osteoblastic stem cell niches after marrow radioablation, provide critical insights into the associated mechanisms, and suggest novel means to manipulate the bone marrow microenvironment to promote HSC engraftment.