Bone is a unique tissue which could regenerate completely after injury rather than heal itself with a scar. Compared with other tissues the difference is that, during bone repairing and regeneration, after the inflammatory phase the mesenchymal stem cells (MSCs) are recruited to the injury site and differentiate into either chondroblasts or osteoblasts precursors, leading to bone repairing and regeneration. Besides these two precursors, the MSCs can also differentiate into adipocyte precursors, skeletal muscle precursors and some other mesodermal cells. With this multiline-age potentiality, the MSCs are probably used to cure bone injury and other woundings in the near future. Here we will introduce the recent developments in understanding the mechanism of MSCs action in bone regeneration and repairing.