We have previously shown that in osteoblasts Sox2 expression can be induced by Fgfs, and can inhibit Wnt signaling and differentiation. Furthermore, in mice in which Sox2 is conditionally deleted in the osteoblastic lineage, bones are osteopenic, and Sox2 inactivation in cultured osteoblasts leads to a loss of proliferative ability with a senescent phenotype. To help understand the role of Sox2 in osteoblast development we have specifically expressed Sox2 in bone from a Col1α1 promoter, which extended Sox2 expression into more mature osteoblasts. In long bones, trabecular cartilage remodeling was delayed and the transition from endochondral to cortical bone was disrupted, resulting in porous and undermineralized cortical bone. Collagen deposition was disorganized, and patterns of osteoclast activity were altered. Calvarial bones were thinner and parietal bones failed to develop the diploic space. Microarray analysis showed significant up- or downregulation of a variety of genes coding for non-collagenous extracellular matrix proteins, with a number of genes typical of mature osteoblasts being downregulated. Our results position Sox2 as a negative regulator of osteoblast maturation in vivo.