Osteogenic differentiation from mesenchymal progenitor cells (MPCs) are initiated and regulated by a cascade of signaling events. Either Wnt/β-catenin or estrogen signaling pathway has been shown to play an important role in regulating skeletal development and maintaining adult tissue homeostasis. Here, we investigate the potential crosstalk and synergy of these two signaling pathways in regulating osteogenic differentiation of MPCs. We find that the activation of estrogen receptor (ER) signaling by estradiol (E2) or exogenously expressed ERα in MPCs synergistically enhances Wnt3A-induced early and late osteogenic markers, as well as matrix mineralization. The E2 or ERα-mediated synergy can be effectively blocked by ERα antagonist tamoxifen. E2 stimulation can enhance endochondral ossification of Wnt3A-transduced mouse fetal limb explants. Furthermore, exogenously expressed ERα significantly enhances the maturity and mineralization of Wnt3A-induced subcutaneous and intramuscular ectopic bone formation. Mechanistically, we demonstrate that E2 does not exert any detectable effect on β-catenin/Tcf reporter activity. However, ERα expression is up-regulated within the first 48h in AdWnt3A-transduced MPCs, whereas ERβ expression is significantly inhibited within 24h. Moreover, the key enzyme for the biosynthesis of estrogens aromatase is modulated by Wnt3A in a biphasic manner, up-regulated at 24h but reduced after 48h. Our results demonstrate that, while ER signaling acts synergistically with Wnt3A in promoting osteogenic differentiation, Wnt3A may crosstalk with ER signaling by up-regulating ERα expression and down-regulating ERβ expression in MPCs. Thus, the signaling crosstalk and synergy between these two pathways should be further explored as a potential therapeutic approach to combating bone and skeletal disorders, such as fracture healing and osteoporosis.