Electronic cigarettes (e-cigarettes) are promoted as low-risk alternatives to combustible cigarettes. However, the effects of chronic inhalation of potential toxicants emitted by ecigarettes remain largely unexamined. It is conceivable that smoking-induced chronic diseases result in cellular injury, in the absence of effective repair by stem cells. This study evaluates the effect of cigarette and e-cigarette aerosol extracts on the survival and differentiation of bone marrow-derived mesenchymal stem cells (MSCs). MSC growth and osteogenic differentiation were examined after exposure to smoke extracts. Data revealed detrimental effects of both cigarette and e-cigarette extracts on MSC morphology and growth. Levels and activity of alkaline phosphatase, an osteogenic marker, decreased and induction of osteoblastic differentiation was impaired. Both smoke extracts prevented osteogenic differentiation from progressing, evident by decreased expression of terminal osteogenic markers and mineralization. Elevated levels of reactive oxygen species (ROS) were detected in cells exposed to smoke extracts. Moreover, decreased differentiation potential was concomitant with severe down-regulation of Connexin 43 expression, leading to the loss of gap junction-mediated communication, which together with elevated ROS levels, could explain decreased proliferation and loss of differentiation potential. Hence, e-cigarettes present similar risk as combustible cigarettes with respect to tissue repair impairment.