OBJECTIVE: To develop a biomarker-based model to predict osteogenic potency of human mesenchymal stem cells (MSCs) from synovial membrane and periosteum. METHODS: MSC populations were derived from adult synovium and periosteum. Phenotype analysis was performed by fluorescence-activated cell sorting and real-time reverse transcriptase-polymerase chain reaction (RT-PCR). Telomere lengths were determined by Southern blot analysis. In vitro osteogenesis was assessed quantitatively by measurements of alkaline phosphatase activity and calcium deposits. To investigate bone formation in vivo, MSCs were seeded onto osteoinductive scaffolds and implanted subcutaneously in nude mice. Bone was assessed by histology, and the human origin investigated by in situ hybridization for human Alu genomic repeats. Quantitation was achieved by histomorphometry and real-time RT-PCR for human osteocalcin. Analysis at the single-cell level was performed with clonal populations obtained by limiting dilution. Multiple regressions were used to explore the incremental predictive value of the markers. RESULTS: Periosteal MSCs had significantly greater osteogenic potency than did synovial MSCs inherent to the single cell. Bone was largely of human origin in vivo. Within the same tissue type, there was variability between different donors. To identify predictors of osteogenic potency, we measured the expression levels of osteoblast lineage genes in synovial and periosteal clonal MSCs prior to osteogenic treatment. We identified biomarkers that correlated with osteogenic outcome and developed a mathematical model based on type I collagen and osteoprotegerin expression that predicts the bone-forming potency of MSC preparations, independent of donor-related variables and tissue source. CONCLUSION: Our findings indicate that our quality-control mathematical model estimates the bone-forming potency of MSC preparations for bone repair.