During the past decade, there has been much interest in the use of human mesenchymal stem cells (hMSCs) in bone tissue engineering. HMSCs can be obtained relatively easily and expanded rapidly in culture, but for clinical purposes large numbers are often needed and the cost should be kept to a minimum. A rapid and efficient culturing protocol would therefore be beneficial. In this study, we examined the effect of different medium compositions on the expansion and osteogenic differentiation of bone marrow-derived hMSCs from 19 donors. We also investigated the effect of low seeding density and dexamethasone on both hMSCs expansion and their in vitro and in vivo osteogenic differentiation capacity. HMSCs seeded at a density of 100 cells/cm2 had a significantly higher growth rate than at 5000 cell/cm2, which was further improved by the addition of dexamethasone. Expanded hMSCs were characterized in vitro on the basis of positive staining for CD29, CD44, CD105, and CD166. The in vitro osteogenic potential of expanded hMSCs was assessed by flow cytometric staining for alkaline phosphatase. In vivo bone-forming potential of the hMSCs was assessed by seeding the cells in ceramic scaffolds, followed by subcutaneous implantation in nude mice and histopathologic assessment of de novo bone formation after 6-week implantation. Expanded hMSCs from all donors displayed similar osteogenic potential independent of the culture conditions. On the basis of these results we have developed an efficient method to culture hMSCs by seeding the cells at 100 cells/cm2 in an alpha-minimal essential medium-based medium containing dexamethasone.