The cellular and molecular mechanisms underlying senile osteoporosis remain poorly understood. In this study, transgenic mCol1α1-Pitx1 mice overexpressing paired-like homeodomain 1 (PITX1), a homeobox transcription factor, rapidly develop a severe type-II osteoporotic phenotype with significant reduction in bone mass and biomechanical strength similar to that seen in humans and reminiscent of the phenotype previously observed in Sca-1 (Ly6a)-null mice. PITX1 plays a critical role in hind limb formation during fetal development, while loss of expression is associated with primary knee/hip osteoarthritis in aging humans. Through in vivo and in vitro analyses, we demonstrate that Pitx1 directly regulates the self-renewal of mesenchymal progenitors and indirectly regulates osteoclast differentiation through the upregulation of Wnt signaling inhibitors DKK1, SOST, and GSK3-β. This is confirmed by elevated levels of plasma DKK1 and the accumulation of phospho-β-catenin in transgenic mice osteoblasts. Furthermore, overexpressed Pitx1 in mice osteoblasts results in severe repression of Sca-1 (Ly6a) that was previously associated with senile osteoporosis. Our study is the first to demonstrate the novel roles of PITX1 in senile osteoporosis where PITX1 regulates the self-renewal of mesenchymal stem cells or progenitor cells through Sca-1 (Ly6a) repression and, in addition, inhibits the Wnt signaling pathway.