BMPs (Bone morphogenetic proteins) such as BMP2 and BMP7 have been used about one decade as bone anabolic agents in orthopaedics. The BMP receptor ACVR1, which is a key receptor of BMP7, is expressed in bone. The pathological role of ACVR1 in humans has been reported: a point mutation in ACVR1 can cause fibrodysplasia ossificans progressiva (FOP) in which ectopic ossification occurs in skeletal muscles and deep connective tissues. The physiological function of ACVR1 in bone, however, is totally unknown. The purpose of this study is to investigate the endogenous role of ACVR1 in osteoblasts, one of the most dominant cell-types in bone. We generated Acvr1-null mice in an osteoblast-specific manner using an inducible Cre-loxP system. Surprisingly, we found that bone mass was increased in the Acvr1-null mice. Interestingly, canonical Wnt signaling was increased and expression levels of Wnt inhibitors Sost and Dkk1 were both suppressed in the null bones during the developmental stages. In addition, we confirmed that expression levels of both Sost and Dkk1 were upregulated by BMP7 dose-dependently in vitro. These results suggest that the Acvr1-deficiency can increase bone mass by activating Wnt signaling in which both Sost and Dkk1 expression levels are diminished. This study leads to a new concept of the BMP7-ACVR1-SOST/DKK1 axis in osteoblasts, in which BMP7 signaling through ACVR1 can reduce Wnt signaling via SOST/DKK1 and then inhibits osteogenesis. Although this concept is beyond the current known function of BMP7, it can explain the varied outcomes of BMP7 treatment. We believe BMP signaling can exhibit multifaceted effects by context and cell type.