Ulmus davidiana Planch (Ulmaceae) (UD) long has been known to have anti-inflammatory and protective effects on damaged tissue, inflammation, and bone among other functions. The herbal medicine also is being used in Oriental medicine to treat osteoporosis. In a preliminary study, treatment of osteoclasts containing long bone cells with the water extract of UD bark prevented the intracellular maturation of cathepsin K (cat K), and thus, it was considered that UD is a pro-drug of a potent bone-resorption inhibitor. To further clarify the role of UD in ossification, we investigated the effects of UD on the proliferation and differentiation of osteoblastic cell lines in vitro. In this study, we assessed the effects of UD on osteoblastic differentiation in nontransformed osteoblastic cells (MC3T3-E1) and rat bone marrow cells. UD enhanced alkaline phosphatase (ALP) activity and mineralization in a dose- and time-dependent fashion. This stimulatory effect of the UD was observed at relatively low doses (significant at 5–50 μg/ml and maximal at 50 μg/ml). Northern blot analysis showed that UD (100 μg/ml) increases in bone morphogenic protein-2 as well as ALP mRNA concentrations in MC3T3-E1 cells. UD slightly increased in type I collagen mRNA abundance throughout the culture period, whereas it markedly inhibited the gene expression of collagenase-1 between days 15 and 20 of culture. These results indicate that UD has anabolic effects on bone through the promotion of osteoblastic differentiation, suggesting that it could be used for the treatment of common metabolic bone diseases such as osteoporosis.