Osteoblast differentiation is a multi-step process where mesenchymal cells differentiate into osteoblast lineage cells including osteocytes. Osterix (Osx) is an osteoblast-specific transcription factor which activates a repertoire of genes during differentiation of preosteoblasts into mature osteoblasts and osteocytes. The essential role of Osx in the genetic program of bone formation and in bone homeostasis is well established. Osx mutant embryos do not form bone and fail to express osteoblast-specific marker genes. Inactivation of Osx in mice after birth causes multiple skeletal phenotypes including lack of new bone formation, absence of resorption of mineralized cartilage, and defects in osteocyte maturation and function. Since Osx is a major effector in skeletal formation, studies on Osx gained momentum over the last 5–7 years and implicated its important function in tooth formation as well as in healing of bone fractures. This review outlines mouse genetic studies that establish the essential role of Osx in bone and tooth formation as well as in healing of bone fractures. We also discuss the recent advances in regulation of Osx expression, which is under control of a transcriptional network, signaling pathways, and epigenetic regulation. Finally, we summarize important findings on the positive and negative regulation of Osx's transcriptional activity through protein–protein interactions in expression of its target genes during osteoblast differentiation. In particular, the identification of the histone demethylase NO66 as an Osx-interacting protein, which negatively regulates Osx activity opens further avenues in studying epigenetic control of Osx target genes during differentiation and maturation of osteoblasts. J. Cell. Biochem. 114: 975–984, 2013. © 2012 Wiley Periodicals, Inc.