Ghrelin is a 28-residue peptide identified in the stomach as an endogenous ligand of the growth hormone secretagogue receptor that is expressed in a variety of peripheral tissues, as well as in the brain. In previous studies, ghrelin has been shown to stimulate both adipogenic differentiation from preadipocytes and osteogenic differentiation from preosteoblasts or primary osteoblasts. This study was undertaken to investigate the direct effect of ghrelin on the lineage allocation of mesenchymal stem cells (MSCs). We identified ghrelin receptor mRNA in C3H10T1/2 cells, and we found the levels of this mRNA to be attenuated during osteogenic differentiation. Treatment of cells with ghrelin resulted in both proliferation and inhibition of caspase-3 activity. In addition, ghrelin decreased serum deprivation-induced bax protein expression and release of cytochrome c from the mitochondria, whereas it increased bcl-2 protein expression. Moreover, ghrelin inhibited early osteogenic differentiation, as shown by alkaline phosphatase activity and staining, and inhibited osteoblast-specific genes expression by altering Runx2, PPARgamma, and C/EBPalpha protein expression.