Both osteoblasts and osteoclasts are derived from progenitors that reside in the bone marrow; osteoblasts belong to the mesenchymal lineage of the marrow stroma, and osteoclasts to the hematopoietic lineage. The development of osteoclasts from their progenitors is dependent on stromal-osteoblastic cells, which are a major source of cytokines that are critical in osteoclastogenesis, such as interleukin-6 and interleukin-11. The production of interleukin-6 by stromal osteoblastic cells, as well as the responsiveness of bone marrow cells to cytokines such as interleukin-6 and interleukin-11, is regulated by sex steroids. When gonadal function is lost, the formation of osteoclasts as well as osteoblasts increases in the marrow, both changes apparently mediated by an increase in the production of interleukin-6 and perhaps by an increase in the responsiveness of bone marrow progenitor cells not only to interleukin-6 but also to other cytokines with osteoclastogenic and osteoblastogenic properties. The cellular activity of the bone marrow is also altered by the process of aging. Specifically, senescence may decrease the ability of the marrow to form osteoblast precursors. The association between the dysregulation of osteoclast or osteoblast development in the marrow and the disruption of the balance between bone resorption and bone formation, resulting in the loss of bone, leads to the following notion. Like homeostasis of other regenerating tissues, homeostasis of bone depends on the orderly replenishment of its cellular constituents. Excessive osteoclastogenesis and inadequate osteoblastogenesis are responsible for the mismatch between the formation and resorption of bone in postmenopausal and age-related osteopenia. The recognition that changes in the numbers of bone cells, rather than changes in the activity of individual cells, form the pathogenetic basis of osteoporosis is a major advance in understanding the mechanism of this disease.