Exogenous glucocorticoids increase the risk for osteoporosis, but the role of endogenous glucocorticoids remains elusive. Here, we describe the generation and validation of a loss- and a gain-of-function model of the cortisol producing enzyme 11β-HSD1 (HSD11B1) to modulate the endogenous glucocorticoid conversion in SCP-1 cells — a model for human mesenchymal stem cells capable of adipogenic and osteogenic differentiation. CRISPR-Cas9 was successfully used to generate a cell line carrying a single base duplication and a 5 bp deletion in exon 5, leading to missense amino acid sequences after codon 146. These inactivating genomic alterations were validated by deep sequencing and by cloning with subsequent capillary sequencing. 11β-HSD1 protein levels were reduced by 70% in the knockout cells and cortisol production was not detectable. Targeted chromosomal integration was used to stably overexpress HSD11B1. Compared to wildtype cells, HSD11B1 overexpression resulted in a 7.9-fold increase in HSD11B1 mRNA expression, a 5-fold increase in 11β-HSD1 protein expression and 3.3-fold increase in extracellular cortisol levels under adipogenic differentiation. The generated cells were used to address the effects of 11β-HSD1 expression on adipogenic and osteogenic differentiation. Compared to the wildtype, HSD11B1 overexpression led to a 3.7-fold increase in mRNA expression of lipoprotein lipase (LPL) and 2.5-fold increase in lipid production under adipogenic differentiation. Under osteogenic differentiation, HSD11B1 knockout led to enhanced alkaline phosphatase (ALP) activity and mRNA expression, and HSD11B1 overexpression resulted in a 4.6-fold and 11.7-fold increase in mRNA expression of Dickkopf-related protein 1 (DKK1) and LPL, respectively. Here we describe a HSD11B1 loss- and gain-of-function model in SCP-1 cells at genetic, molecular and functional levels. We used these models to study the effects of endogenous cortisol production on mesenchymal stem cell differentiation and demonstrate an 11β-HSD1 dependent switch from osteogenic to adipogenic differentiation. These results might help to better understand the role of endogenous cortisol production in osteoporosis on a molecular and cellular level.