Ephrin B2/EphB4 mediates interactions among osteoblasts (OBs), osteoclasts (OCLs), and chondrocytes to regulate their differentiation. We investigated the role of ephrin B2/EphB4 signaling in mediating the anabolic effects of insulin-like growth factor-I (IGF-I) and parathyroid hormone (PTH) on those cells and overall endochondral bone formation. Immunohistochemistry demonstrated that the expression of ephrin B2 in OBs, OCLs, and osteocytes, and the expression of EphB4 in OBs and osteocytes was dramatically decreased in global IGF-I knockout mice. Inactivation of EphB4 by EphB4 small, interfering RNA (siRNA) in cultured bone marrow stromal cells significantly decreased the mRNA levels of OB differentiation markers and abolished the stimulatory effects of IGF-I on these markers. Blocking the interaction of EphB4 and ephrin B2 in the OB-OCL cocultures with the EphB4 specific peptide TNYL-RAW or deletion of ephrin B2 in OCL prior to coculture led to fewer and smaller tartrate-resistant acid phosphatase (TRAP)-positive cells, decreased expression of OB differentiation markers, and blunted response to IGF-I for both OCL and OB differentiation. In the growth plate, both ephrin B2 and EphB4 are expressed in late stage proliferating and prehypertrophic chondrocytes, and their expression was decreased in mice lacking the IGF-I receptor specifically in chondrocytes. In vitro, blocking the interaction of EphB4 and ephrin B2 in chondrogenic ATDC5 cells with TNYL-RAW significantly decreased both basal and IGF1-induced expression of type II and type X collagen. In the cocultures of ATDC5 cells and spleen cells (osteoclast precursors), TNYL-RAW decreased the numbers of TRAP-positive cells and the expression of nuclear factor of activated T cells, cytoplasmic 1 (NFATc1) and receptor activator of NF-κB (RANK), and blocked their stimulation by IGF-I. Our data indicate that IGF-I/IGF-IR signaling promotes OB, OCL, and chondrocyte differentiation via ephrin B2/EphB4 mediated cell-cell communication. © 2014 American Society for Bone and Mineral Research.