Stem cells are thought to inhabit in a unique microenvironment, known as “niche,” in which they undergo asymmetric cell divisions that results in reproducing both stem cells and progenies to maintain various tissues throughout life. The cells of osteoblastic lineage have been identified as a key participant in regulating the number of hematopoietic stem cells (HSCs). HSCs receive their regulatory messages from the microenvironment in the bone marrow. This would account for a reason why the localization of hematopoiesis is usually restricted in the bone marrow. To clarify the above possibility we employed a cell implantation-based strategy with a unique osteoblast cell line (KUSA-A1) derived from a C3H/He mouse. The implantation of KUSA-A 1 cells resulted in the generation of ectopic bones in the subcutaneous tissues of the athymic BALB/c nu/nu mice. Subsequently the mice obtained a greater amount of the bone marrow than normal mice, and they showed an increased number of HSCs. These results indicate that the newly generated osteoblasts-derived ectopic bones are responsible for the increase in the number of the HSC population. Furthermore, the increased number of HSCs directly correlates with both the magnitude of dynamic osteogenic process and the size of the newly generated bone or “niche.” J. Cell. Physiol. © 2006 Wiley-Liss, Inc.