Bone abnormalities, one of the primary manifestations of Menkes disease (MD), include a weakened bone matrix and low mineral density. However, the molecular and cellular mechanisms underlying these bone defects are poorly understood. Here, we present in vitro modeling for impaired osteogenesis in MD using human induced pluripotent stem cells (iPSCs) with a mutated ATP7A gene. MD-iPSC lines were generated from two patients harboring different mutations. The MD-iPSCs showed a remarkable retardation in CD105 expression with morphological anomalies during development to mesenchymal stem cells (MSCs) compared with wild type (WT)-iPSCs. Although prolonged culture enhanced CD105 expression, interestingly, mature MD-MSCs presented with low alkaline phosphatase activity, reduced calcium deposition in the extracellular matrix, and down-regulated osteoblast-specific genes during osteoblastic differentiation in vitro. Copper chelation in WT-MSCs recapitulated the aberrant phenotypes observed in MD-MSCs, but copper treatment in MD-MSCs did not rescue the impaired osteogenesis. Lysyl oxidase activity was also decreased in MD-MSCs during osteoblastic differentiation. Our findings indicate that ATP7A dysfunction contributes to retardation in MSC development and impairs osteogenesis.