Bone cells are known to express multiple P2 receptor subtypes, and the functional effects of receptor activation have been described for many of these. One exception is the P2X4 receptor, which despite strong expression in osteoblasts and osteoclasts, has no defined functional activity. This study used the selective P2X4 receptor antagonists, 5-BDBD and PSB-12062, to investigate the role of this receptor in bone. Both antagonists (≥ 0.1 μM) dose-dependently decreased bone formation by 60–100%. This was accompanied by a ≤ 70% decrease in alkaline phosphatase activity, a ≤ 40% reduction in cell number, and a ≤ 80% increase in the number of adipocytes present in the culture. The analysis of gene expression showed that levels of osteoblast marker genes (e.g.Alpl,Bglap) were decreased in 5-BDBD treated cells. Conversely, expression of the adipogenic transcription factorPPARGwas increased 10-fold. In osteoclasts, high doses of both antagonists were associated with a reduction in osteoclast formation and resorptive activity by ≤ 95% and ≤ 90%, respectively. Taken together, these data suggest that the P2X4 receptor plays a role in modulating bone cell function. In particular, it appears to influence osteoblast differentiation favouring the osteogenic lineage over the adipogenic lineage.