We report that oxytocin (OT), a primitive neurohypophyseal hormone, hitherto thought solely to modulate lactation and social bonding, is a direct regulator of bone mass. Deletion of OT or the OT receptor (Oxtr) in male or female mice causes osteoporosis resulting from reduced bone formation. Consistent with low bone formation, OT stimulates the differentiation of osteoblasts to a mineralizing phenotype by causing the up-regulation of BMP-2, which in turn controls Schnurri-2 and 3, Osterix, and ATF-4 expression. In contrast, OT has dual effects on the osteoclast. It stimulates osteoclast formation both directly, by activating NF-kappaB and MAP kinase signaling, and indirectly through the up-regulation of RANK-L. On the other hand, OT inhibits bone resorption by mature osteoclasts by triggering cytosolic Ca(2+) release and NO synthesis. Together, the complementary genetic and pharmacologic approaches reveal OT as a novel anabolic regulator of bone mass, with potential implications for osteoporosis therapy.