Ewing sarcoma, an osteolytic malignancy that mainly affects children and young adults, is characterized by early metastasis to lung and bone. In this study, we identified the pro-metastatic gene DKK2 as a highly overexpressed gene in Ewing sarcoma compared with corresponding normal tissues. Using RNA interference, we showed that DKK2 was critical for malignant cell outgrowth in vitro and in an orthotopic xenograft mouse model in vivo. Analysis of invasion potential in both settings revealed a strong correlation of DKK2 expression to Ewing sarcoma invasiveness that may be mediated by the DKK effector matrix metalloproteinase 1 (MMP1). Furthermore, gene expression analyses established the ability of DKK2 to differentially regulate genes such as CXCR4, PTHrP, RUNX2, and TGFβ1 that are associated with homing, invasion, and growth of cancer cells in bone tissue as well as genes important for osteolysis, including HIF1α, JAG1, IL6, and VEGF. DKK2 promoted bone infiltration and osteolysis in vivo and further analyses defined DKK2 as a key factor in osteotropic malignancy. Interestingly, in Ewing sarcoma cells, DKK2 suppression simultaneously increased the potential for neuronal differentiation while decreasing chondrogenic and osteogenic differentiation. Our results provide strong evidence that DKK2 is a key player in Ewing sarcoma invasion and osteolysis and also in the differential phenotype of Ewing sarcoma cells.