Body phosphate homeostasis is regulated by a hormonal counter-balanced intestine-bone-kidney axis. The major systemic hormones involved in this axis are parathyroid hormone (PTH), 1,25-dihydroxyvitamin-D, and fibroblast growth factor-23 (FGF23). FGF23, produced almost exclusively by the osteocytes, is a phosphaturic hormone that plays a major role in regulation of the bone remodeling process. Remodeling composite components, bone mineralization and resorption cycles create a continuous influx-efflux loop of the inorganic phosphate (Pi) through the skeleton. This "bone Pi loop," which is formed, is controlled by local and systemic factors according to phosphate homeostasis demands. Although FGF23 systemic actions in the kidney, and for the production of PTH and 1,25-dihydroxyvitamin-D are well established, its direct involvement in bone metabolism is currently poorly understood. This review presents the latest available evidence suggesting two aspects of FGF23 bone local activity: (a) Regulation of FGF23 production by both local and systemic factors. The suggested local factors include extracellular levels of Pi and pyrophosphate (PPi), (the Pi/PPi ratio), and another osteocyte-derived protein, sclerostin. In addition, 1,25-dihydroxyvitamin-D, synthesized locally by bone cells, may contribute to regulation of FGF23 production. The systemic control is achieved via PTH and 1,25-dihydroxyvitamin-D endocrine functions. (b) FGF23 acts as a local agent, directly affecting bone mineralization. We support the assumption that under balanced physiological conditions, sclerostin, by para- autocrine signaling, upregulates FGF23 production by the osteocyte. FGF23, in turn, acts as a mineralization inhibitor, by stimulating the generation of the major mineralization antagonist-PPi.