In both endogenous and exogenously-introduced human mesenchymal stem cells (hMSCs), homing to sites of regeneration requires navigation through complex extracellular matrix environments that impose confinement on migrating cells. Despite its prevalence in vivo, the impact of confinement on hMSC differentiation remains poorly understood. To address these questions, a physiologically relevant, flow-free polydimethylsiloxane-based microchannel system with confining widths ranging from 3 to 10 µm in width, is developed. In these microchannel systems, it is found that hMSCs migrate faster and experience significant nuclear deformation in 3 µm wide channels compared to wider 10 µm channels. These morphological changes persist for days postexit, implying that stem cells possess a mechanical memory of their past confined migration. High degrees of nuclear deformation also correlated with substantial changes in genome regulation, as cells displayed significant H3K9 acetylation postconfinement. In these postconfinement stem cells, significantly higher expression levels of RUNX2 along with a higher degree of nuclear-to-cytoplasmic shuttling are found, suggesting that short confined migration can stimulate osteogenic differentiation. Finally, it is found that nuclear mechanosensing via the cytoskeleton is not the primary factor driving confinement-induced differentiation. These results suggest that physiological confinement can serve as a key mechanical cue promoting early osteogenic differentiation in hMSCs.