In our previous studies, roles of gap junction and vascular endothelial growth factor in the cross-talking of human bone marrow stromal cells (HBMSCs) and human umbilical vein endothelial cells (HUVECs) have been extensively studied. The present study focused on the investigation of the roles of neural (N)-cadherin in early differentiation of HBMSCs in direct-contact cocultures with HUVECs for 24 and 48 h. Quantitative real-time polymerase chain reaction, immunofluorescence, Western blot, as well as functional studies were applied to perform the studies at both protein and gene levels. Results showed that cocultured cells expressed much higher N-cadherin than monocultured cells after 24 and 48 h of culture. We observed that N-cadherin concentrated in the membrane of cocultured HBMSCs (co-HBMSCs) while distributed within the cytoplasm of monocultured HBMSCs, which indicated that the cell-cell adhesion was improved between cocultured cells. In addition, more beta-catenin was found to translocate into the cocultured cells nuclei and more T cell factor-1 (TCF-1) were detected in cocultured cells than in the monocultured cells. Moreover, mRNA levels of early osteoblastic markers including alkaline phosphatase (ALP) and type I collagen (Col-I) of co-HBMSCs were significantly upregulated, whereas neutralization of N-cadherin led to a downregulation of ALP and Col-I in both of the HBMSCs and co-HBMSCs compared with untreated cells. Taking our findings together it can be concluded that cocultures of HBMSCs with HUVECs increased N-cadherin expression and improved cell-cell adhesion. Whether this applies only to osteoprogenitor cells or to all the cell types in the culture will need to be determined by further studies. Subsequently, signaling transduction might be induced with the participation of beta-catenin and TCF-1. With the N-cadherin-mediated cell-cell adhesion and signaling transductions, the early osteoblastic differentiation of co-HBMSCs was significantly upregulated.