Mesenchymal stem cells (MSCs) can differentiate into a number of cell types, including adipocytes and osteoblasts. MSC differentiation into adipocytes inhibits osteogenic differentiation and vice versa. Therefore, understanding the mechanisms of MSC differentiation at the signaling level can lead to the development of novel therapeutic strategies toward tissue regeneration. Sphingosine-1-phosphate (S1P) is a signaling molecule that regulates many cellular responses, including cellular differentiation. However, the effects of S1P on MSC differentiation are largely unknown. The purpose of study was to investigate whether S1P drives MSCs toward either adipogenic or osteogenic differentiation, and if so, to clarify the underlying signaling mechanisms for such differentiation. We found that S1P inhibited adipogenic differentiation of C3H10T1/2 multipotent stem cells, while promoting their osteogenic differentiation. During adipogenic differentiation, S1P suppressed the cAMP accumulation in a Gi-protein-dependent manner. The Gi-dependent S1P signaling suppressed C/EBPβ expression, which is essential for adipogenic differentiation. Furthermore, S1P did not affect cAMP-independent adipogenic differentiation. These findings suggest that S1P suppresses cAMP accumulation, leading to inhibition of C/EBPβ expression, thereby resulting in decreased adipogenic differentiation of C3H10T1/2 cells. Thus, our findings provide novel molecular mechanisms as regards how S1P inhibits adipogenic differentiation of C3H10T1/2 cells, indicating a potential beneficial role for regeneration and repair of tissues.