Early B cell factor 1 (EBF1) is a transcription factor expressed by multiple lineages of stromal cells within the bone marrow. While cultures of Ebf1-deficient cells have been demonstrated to have impaired differentiation into either the osteoblast or adipogenic lineage in vitro by several groups, in vivo there has been a nominal consequence of the loss of EBF1 on skeletal development. In this study we used Prx-cre driven deletion of Ebf1 to eliminate EBF1 from the entire mesenchymal lineage of the skeleton and resolve this discrepancy. We report here that EBF1 is expressed primarily in the Mesenchymal Stem and Progenitor Cell (MSPC)-Adipo, MSPC-Osteo, and the Early Mesenchymal Progenitors, and that loss of EBF1 has a plethora of consequences to maintenance of the skeleton throughout adulthood. Stroma from the Prx-cre;Ebf1fl/fl bones had impaired osteogenic differentiation, an age-dependent loss of CFU-F, and elevated senescence accompanying Ebf1-deletion. New bone formation was reduced after 3 months, and resulted in a quiescent bone environment with fewer osteoblasts and an accompanied reduction in osteoclast-mediated remodeling. Consequently, bones were less ductile at a younger age, and deletion of EBF1 dramatically impaired fracture repair. Disruption of EBF1 in perivascular populations also rearranged the vascular network within these bones and disrupted cytokine signaling from key hematopoietic niches resulting in anemia, reductions in B cells, and myeloid skewing of marrow hematopoietic lineages. Mechanistically we observed disrupted BMP signaling within Ebf1-deficient progenitors with reduced SMAD1-phosphorylation, and elevated secretion of the soluble BMP-inhibitor Gremlin from the MSPC-Adipo cells. Ebf1-deficient progenitors also exhibited posttranslational suppression of glucocorticoid receptor expression. Together, these results suggest that EBF1 signaling is required for mesenchymal progenitor mobilization to maintain the adult skeleton, and that the primary action of EBF1 in the early mesenchymal lineage is to promote proliferation, and differentiation of these perivascular cells to sustain a healthy tissue.