Runx2 plays important roles in the regulation of chondrocyte differentiation and proliferation; however, the Runx2 target molecules still remain to be investigated. We searched the genes upregulated by the introduction of Runx2 into Runx2(-/-) chondrocytes using microarray and found that Tcf7 is upregulated by Runx2. Thus, we examined the functions of Runx2 in the regulation of the Tcf/Lef family of transcription factors. Runx2 induced Tcf7 and Lef1 strongly, but Tcf7l1 and Tcf7l2 only slightly in Runx2(-/-) chondrocytes; the expressions of Tcf7 and Tcf7l2 were reduced in Runx2(-/-) cartilaginous skeletons and calvaria, and Tcf7 showed a similar expression pattern to Runx2. In reporter assays, Runx2 mildly activated the 8.6 and 1.8 kb Tcf7 promoter constructs. The reporter assays using the deletion constructs of the 1.8-kb fragment showed that the 0.3-kb promoter region is responsible for the Runx2-dependent transcriptional activation. To investigate the function of Tcf7 in skeletal development, we generated dominant-negative (dn) Tcf7 transgenic mice using the Col2a1 promoter. Dn-Tcf7 transgenic embryos showed dwarfism, and mineralization was retarded in limbs, ribs, and vertebrae in a manner dependent on the expression levels of the transgene. In situ hybridization analysis showed that endochondral ossification is retarded in dn-Tcf7 transgenic embryos due to the decelerated chondrocyte maturation. Further, BrdU labeling showed a reduction in chondrocyte proliferation in the proliferating layer of the growth plate in dn-Tcf7 transgenic embryos. These findings indicate that Runx2 regulates chondrocyte maturation and proliferation at least partly through the induction of Tcf7.