Hydrolyzed fish collagen (HFC) has recently attracted considerable attention because of its outstanding bioactivity. However, few studies have been performed to determine the biological effects of HFC on bone marrow mesenchymal stem cells (BMSCs), which are often used in regenerative medicine. In this study, the molecular weight, amino acid composition, and contact angle of HFC were measured. The influence of HFC on cell viability and the multidirectional differentiation of BMSCs into osteogenic, endothelial, adipogenic, chondrogenic, and neural lineages were also assessed. Furthermore, the mechanism by which HFC promotes osteogenesis was investigated at the protein level. The molecular weight of HFC ranged from 700 to 1300 Da, the contact angle of HFC was approximately 26°, and HFC was found to be composed of various amino acids, including glycine, proline, and hydroxyproline. At a concentration of 0.2 mg/mL, HFC promoted cell viability, and significantly up-regulated the expression of osteogenic markers (RUNX2, ALP, OPN, and OCN), as well as endothelial markers (CD31, VE-cadherin, and VEGFR2). Western blot results indicated that treatment of BMSCs with 0.2 mg/mL HFC could activate the MAPK/ERK signaling pathway and then increase the protein level of RUNX2, while treatment with PD98059, a specific inhibitor of ERK1/2, could significantly inhibit the expression of P-ERK and RUNX2. Interestingly, real-time PCR demonstrated that HFC inhibited the expression of adipogenic markers (LPL and ADFP) and chondrogenic markers (aggrecan and COLII), whereas it had no effect on neural differentiation markers (MAP2 and β3-tubulin). In summary, this study suggests that without the use of any additional inducing reagent, HFC has the potential to actively promote osteogenic and endothelial differentiation because of its high hydrophilicity and the optimal extracellular microenvironment supplied by its amino acids. This research also revealed that HFC inhibited adipogenic and chondrogenic differentiation, but it had no influence on the neural differentiation of rat bone marrow mesenchymal stem cells (rBMSCs).