Bone marrow mesenchymal stem cells (BMSCs) exhibit an age-related lineage switch between osteogenic and adipogenic fates, which contributes to bone loss and adiposity. Here we identified a long noncoding RNA, Bmncr, which regulated the fate of BMSCs during aging. Mice depleted of Bmncr (Bmncr-KO) showed decreased bone mass and increased bone marrow adiposity, whereas transgenic overexpression of Bmncr (Bmncr-Tg) alleviated bone loss and bone marrow fat accumulation. Bmncr regulated the osteogenic niche of BMSCs by maintaining extracellular matrix protein fibromodulin (FMOD) and activation of the BMP2 pathway. Bmncr affected local 3D chromatin structure and transcription of Fmod. The absence of Fmod modified the bone phenotype of Bmncr-Tg mice. Further analysis revealed that Bmncr would serve as a scaffold to facilitate the interaction of TAZ and ABL, and thus facilitate the assembly of the TAZ and RUNX2/PPARG transcriptional complex, promoting osteogenesis and inhibiting adipogenesis. Adeno-associated viral-mediated overexpression of Taz in osteoprogenitors alleviated bone loss and marrow fat accumulation in Bmncr-KO mice. Furthermore, restoring BMNCR levels in human BMSCs reversed the age-related switch between osteoblast and adipocyte differentiation. Our findings indicate that Bmncr is a key regulator of the age-related osteogenic niche alteration and cell fate switch of BMSCs.