betaig-h3 is an extracellular matrix (ECM) protein induced by TGF-beta, and it has motifs interacting with the alpha3beta1, alphavbeta5, and alphavbeta3 integrins. Our previous study shows the role of betaig-h3 in osteoblast differentiation and its involvement in melorheostosis, a rare bone disease. Here we demonstrate that betaig-h3 expression is down-regulated during the early stage of differentiation of the murine preosteoblastic cell line, KS483. The recombinant betaig-h3 and its FAS1 domain significantly inhibited in vitro osteoblast differentiation as evaluated by matrix mineralization/bone nodule formation. Furthermore, inhibition of expression of osteoblast differentiation marker genes [such as type I collagen, alkaline phosphatase, and osteocalcin (OC)] was accompanied by suppression of osteoblast-specific transcription factors, Cbfa1/Runx2 and osterix. Flow cytometric analyses, cell adhesion, and inhibition assays disclosed alphavbeta3 and alphavbeta5 as the principal integrins mediating the adhesion of osteoblastic cells to betaig-h3. The disruption of interactions between betaig-h3 and osteoblasts by a function-blocking antibody specific for alphavbeta3 but not for alphavbeta5 abolished the inhibitory effect of betaig-h3 on osteoblast differentiation. We suggest that these interacting integrins may play an important role in betaig-h3-mediated inhibition of osteoblast differentiation.