Inhibition of sclerostin, a glycoprotein secreted by osteocytes, offers new therapeutic paradigm for treatment of osteoporosis (OP) through its critical role as Wnt/catenin signaling regulator. This study describes the epigenetic regulation of SOST expression in bone biopsies of postmenopausal women. We correlated serum sclerostin, to bone mineral density (BMD), fractures and bone remodeling parameters and related these findings to epigenetic and genetic disease mechanisms. Serum sclerostin and bone remodeling biomarkers were measured in two postmenopausal groups: healthy (BMD T-score > -1) and established OP (BMD T-score < -2.5, with at least one low energy fracture). Bone specimens were used to analyze SOST mRNAs, single nucleotide polymorphisms (SNPs) and DNA methylation changes. The SOST gene promoter region showed increased CpG methylation in OP patients (n=4) compared to age and body mass index balanced controls (n=4) (80.5% vs. 63.2%, p=0.0001) with replication in independent cohorts (n=27 and 36, respectively). Serum sclerostin and bone SOST mRNA expression correlated positively with age- and BMI-adjusted total hip BMD (r=0.47 and 0.43, respectively, both p<0.0005), and inversely to serum bone turnover markers. Five SNPs, of which one replicates in an independent population based GWAS, showed association with serum sclerostin or SOST mRNA levels under an additive model (p: 0.0016 to 0.0079). Genetic and epigenetic changes in SOST influence its bone mRNA expression and serum sclerostin levels in postmenopausal women. The observations suggest that increased SOST promoter methylation seen in OP is a compensatory counteracting mechanism, which lowers serum sclerostin concentrations and reduces inhibition of Wnt signaling in an attempt to promote bone formation. © 2014 American Society for Bone and Mineral Research