Exercise-generated signals are pro-osteogenic and anti-adipogenic within the marrow. In vitro studies indicate that mechanical signals directly block adipogenic differentiation through activation of beta-catenin and by limiting PPAR gamma 2 expression. Whether mechanically generated beta-catenin can inhibit adipogenesis during PPAR gamma transactivation is unknown. We evaluated the ability of mechanical signals to limit adipogenesis in marrow derived mesenchymal stem cells (mdMSC) distal to activation of PPAR gamma. First, we established that mdMSC attained an adipogenic phenotype within 2-4 days in the presence of rosiglitazone (1-25 mu M) and that beta-catenin activation via GSK3 beta inhibition interfered with this process. Similarly, mechanical strain (3600 cycles, 2% strain daily) inhibited adipogenesis at 3 days, preventing rosiglitazone-induced PPAR gamma upregulation as well as aP2 and adiponectin protein expression. To assess whether a reduction in PPAR gamma expression was necessary for anti-adipogenic action, PPAR gamma 2 was overexpressed: both mechanical strain and GSK3 beta inhibition prevented expression of aP2 and adiponectin proteins despite abundant PPAR gamma 2 and its ligand. To understand the fate of single cells experiencing mechanical strain we generated mdMSC from aP2-GFP reporter expressing mice. Rosiglitazone treatment for 3 days induced GFP expression in more than 80% of cells. Sorting by GFP expression revealed that the highest 20% of aP2-GFP expressing cells was responsible for the majority of adipogenic protein expression. This highly expressing GFP fraction had a reduced ability to respond to an osteogenic stimulus: BMP-2 treatment increased osterix by 12-fold in contrast to the 42-fold increase in osterix expression that resulted from BMP-2 treatment of the bottom 75% of GFP expressing cells. This suggested that highly expressing aP2-GFP cells represented more terminally differentiated adipocytes, with reduced multipotentiality. Application of mechanical strain to aP2-GFP mdMSC treated with rosiglitazone caused a two-fold decrease in the size of the upper cell fraction, suggesting that mechanical strain preserved MSC in a multipotent state. Our data show that mechanical strain restricts adipogenesis both by limiting PPAR gamma 2 expression and by preventing PPAR gamma action, protecting the potential of MSC to enter other lineages. (C) 2012 Elsevier Inc. All rights reserved.