ZNF281 is one of the core transcription factors in embryonic stem cells (ESCs) and has activation and repression roles in the transcription of ESC genes. A known target molecule of Zfp281 (the mouse homologue of ZNF281) is Nanog. However, NANOG is not expressed in most human multipotent stem cells (hMSCs). Here, we investigated the roles of ZNF281 with a gain- and loss-of-function study. The knockdown of ZNF281 in vivo and in vitro resulted in spontaneous osteochondrogenic differentiation and reduced the proliferation of hMSCs, as determined by cell morphology and molecular markers. When ZNF281-knockdown hMSCs were subcutaneously implanted into mice along with β-tricalcium phosphate (β-TCP), many cells were converted into osteoblasts within 4 weeks. In contrast, the overexpression of ZNF281 in hMSCs resulted in accelerated proliferation. The expression pattern of ZNF281 correlated well with the expression of β-CATENIN during differentiation and in the gain/loss-of-function study in hMSCs. The binding of ZNF281 to the promoter region of β-CATENIN was observed using a chromatin immunoprecipitation (ChIP) assay. In conclusion, we propose that ZNF281 plays an important role in the maintenance and osteogenic differentiation of stem cells via the transcriptional regulation of genes including β-CATENIN.