Runx2 is an essential transcription factor for skeletal development. It is expressed in multipotent mesenchymal cells, osteoblast-lineage cells, and chondrocytes. Runx2 plays a major role in chondrocyte maturation, and Runx3 is partly involved. Runx2 regulates chondrocyte proliferation by directly regulating Ihh expression. It also determines whether chondrocytes become those that form transient cartilage or permanent cartilage, and functions in the pathogenesis of osteoarthritis. Runx2 is essential for osteoblast differentiation and is required for the proliferation of osteoprogenitors. Ihh is required for Runx2 expression in osteoprogenitors, and hedgehog signaling and Runx2 induce the differentiation of osteoprogenitors to preosteoblasts in endochondral bone. Runx2 induces Sp7 expression, and Runx2, Sp7, and canonical Wnt signaling are required for the differentiation of preosteoblasts to immature osteoblasts. It also induces the proliferation of osteoprogenitors by directly regulating the expression of Fgfr2 and Fgfr3. Furthermore, Runx2 induces the proliferation of mesenchymal cells and their commitment into osteoblast-lineage cells through the induction of hedgehog (Gli1, Ptch1, Ihh), Fgf (Fgfr2, Fgfr3), Wnt (Tcf7, Wnt10b), and Pthlh (Pth1r) signaling pathway gene expression in calvaria, and more than a half-dosage of Runx2 is required for their expression. This is a major cause of cleidocranial dysplasia, which is caused by heterozygous mutation of RUNX2. Cbfb, which is a co-transcription factor that forms a heterodimer with Runx2, enhances DNA binding of Runx2 and stabilizes Runx2 protein by inhibiting its ubiquitination. Thus, Runx2/Cbfb regulates the proliferation and differentiation of chondrocytes and osteoblast-lineage cells by activating multiple signaling pathways and via their reciprocal regulation.