Although many regulators of skeletogenesis have been functionally characterized, one current challenge is to integrate this information into regulatory networks. Here, we discuss how the canonical Wnt and Smad-dependent BMP pathways interact together and play antagonistic or cooperative roles at different steps of osteogenesis, in the context of the developing vertebrate embryo. Early on, BMP signaling specifies multipotent mesenchymal cells into osteochondroprogenitors. In turn, the function of Wnt signaling is to drive these osteochondroprogenitors towards an osteoblastic fate. Subsequently, both pathways promote osteoblast differentiation, albeit with notable mechanistic differences. In osteocytes, the ultimate stage of osteogenic differentiation, the Wnt and BMP pathways exert opposite effects on the control of bone resorption by osteoclasts. We describe how the dynamic molecular wiring of the canonical Wnt and Smad-dependent BMP signaling into the skeletal cell genetic programme is critical for the generation of bone-specific cell types during development.