Osteocytes are the terminally differentiated cell type of the osteoblastic lineage and have important functions in skeletal homeostasis. Although the transcriptional regulation of osteoblast differentiation has been well characterized, the factors that regulate differentiation of osteocytes from mature osteoblasts are poorly understood. Here we show that miR-23a∼27a∼24-2 (miR-23a cluster) promotes osteocyte differentiation. Osteoblast-specific miR-23a cluster gain-of-function mice have low bone mass associated with decreased osteoblast but increased osteocyte numbers. By contrast, loss-of-function transgenic mice overexpressing microRNA decoys for either miR-23a or miR-27a, but not miR24-2, show decreased osteocyte numbers. Moreover, RNA-sequencing analysis shows altered transforming growth factor-β (TGF-β) signalling. Prdm16, a negative regulator of the TGF-β pathway, is directly repressed by miR-27a with concomitant alteration of sclerostin expression, and pharmacological inhibition of TGF-β rescues the phenotypes observed in the gain-of-function transgenic mice. Taken together, the miR-23a cluster regulates osteocyte differentiation by modulating the TGF-β signalling pathway through targeting of Prdm16.