Previous reports have identified a role for the tyrosine kinase receptor EphB4 and its ligand, ephrinB2, as potential mediators of both bone formation by osteoblasts and bone resorption by osteoclasts. In the present study, we examined the role of EphB4 during bone repair after traumatic injury. We performed femoral fractures with internal fixation in transgenic mice that overexpress EphB4 under the collagen type 1 promoter (Col1-EphB4) and investigated the bone repair process up to 12 weeks postfracture. The data indicated that Col1-EphB4 mice exhibited stiffer and stronger bones after fracture compared with wild-type mice. The fractured bones of Col1-EphB4 transgenic mice displayed significantly greater tissue and bone volume 2 weeks postfracture compared with that of wild-type mice. These findings correlated with increased chondrogenesis and mineral formation within the callus site at 2 weeks postfracture, as demonstrated by increased safranin O and von Kossa staining, respectively. Interestingly, Col1-EphB4 mice were found to possess significantly greater numbers of clonogenic mesenchymal stromal progenitor cells (CFU-F), with an increased capacity to form mineralized nodules in vitro under osteogenic conditions, when compared with those of the wild-type control mice. Furthermore, Col1-EphB4 mice had significantly lower numbers of TRAP-positive multinucleated osteoclasts within the callus site. Taken together, these observations suggest that EphB4 promotes endochondral ossification while inhibiting osteoclast development during callus formation and may represent a novel drug target for the repair of fractured bones. © 2013 American Society for Bone and Mineral Research.