Mutations in fibroblast growth factor receptors (Fgfrs) 1–3 cause skeletal disease syndromes in humans. Although these Fgfrs are expressed at various stages of chondrocyte and osteoblast development, their function in specific skeletal cell types is poorly understood. Using conditional inactivation of Fgfr1 in osteo-chondrocyte progenitor cells and in differentiated osteoblasts, we provide evidence that FGFR1 signaling is important for different stages of osteoblast maturation. Examination of osteogenic markers showed that inactivation of FGFR1 in osteo-chondro-progenitor cells delayed osteoblast differentiation, but that inactivation of FGFR1 in differentiated osteoblasts accelerated differentiation. In vitro osteoblast cultures recapitulated the in vivo effect of FGFR1 on stage-specific osteoblast maturation. In immature osteoblasts, FGFR1 deficiency increased proliferation and delayed differentiation and matrix mineralization, whereas in differentiated osteoblasts, FGFR1 deficiency enhanced mineralization. Furthermore, FGFR1 deficiency in differentiated osteoblasts resulted in increased expression of Fgfr3, a molecule that regulates the activity of differentiated osteoblasts. Mice lacking Fgfr1, either in progenitor cells or in differentiated osteoblasts, showed increased bone mass as adults. These data demonstrate that signaling through FGFR1 in osteoblasts is necessary to maintain the balance between bone formation and remodeling through a direct effect on osteoblast maturation.