Postmenopausal osteoporosis is characterized by an imbalance of bone resorption exceeding bone formation, resulting in a net loss of bone mineral density (BMD). Estrogen deficiency is known to promote bone resorption. However, the causative factors that impair bone formation have not been identified. Women after menopause experience not only estrogen deficiency but also iron accumulation as a result of cessation of menstruation. In this study we investigated whether increased iron plays a role in osteoporosis. By growing primary mouse osteoclast and osteoblast progenitor cells as well as immortalized cell lines in the presence of iron, we found that increased iron had minimal effects on osteoclast cell differentiation. Interestingly, iron, particularly in its inorganic form, and to a lesser extent ferritin and transferrin all suppressed alkaline phosphatase (ALP) activities in osteoblasts. Moreover, iron downregulated mRNA levels of several other osteoblastogenic markers such as Runx2, osterix, osteopontin, and osteocalcin. To further show that this in vitro finding is relevant to the in vivo condition, we demonstrated that iron-accumulated mice with intact ovaries exhibited a significant decrease in BMD. Although iron inhibited preosteoblast cell differentiation, it did enhance preosteoblast cell proliferation, as evidenced by increased cell growth and expression of cell cycle regulator genes such as CDK4, CDK6, cyclin D1, and cyclin D3 and G2/M phase cell population. Taken together, our results suggest that increased iron could be a factor that slows down bone formation in postmenopausal women. © 2011 American Society for Bone and Mineral Research.