Spinal cord injury (SCI) causes a significant amount of bone loss, which results in osteoporosis (OP). The neuropeptide substance P (SP) and SP receptors may play important roles in the pathogenesis of OP after SCI. To identify the roles of SP in the bone marrow mesenchymal stem cell derived osteoblasts (BMSC-OB) in SCI rats, we investigated the expression of neurokinin-1 receptors (NK1R) in BMSC-OB and the effects of SP on bone formation by development of BMSC-OB cultures. Sixty young male Sprague-Dawley rats were randomized into two groups: SHAM and SCI. The expression of NK1R protein in BMSC-OB was observed using immunohistochemistry and Western blot analysis. The dose- and time-dependent effects of SP on the proliferation, differentiation and mineralization of BMSC-OB and the expression of osteoblastic markers by in vitro experiments. The expression of NK1R in BMSC-OB was observed on plasma membranes and in cytoplasm. One week after osteogenic differentiation, the expression of NK1R was significantly increased after SCI at mRNA and protein levels. However, this difference was gradually attenuated at 2 or 3 weeks later. SP have the function to enhance cell proliferation, inhibite cell differentiation and mineralization at a proper concentration and incubation time, and this effect would be inhibited by adding SP or NK1R antagonist. The expression of RANKL/OPG was significantly increased in tibiae after SCI. Similarly, the RANKL/OPG expression in SCI rats was significantly increased when treating with 10−8 M SP. SP plays a very important role in the pathogenesis of OP after SCI. The direct effect of SP may lead to increased bone resorption through the RANKL/OPG axis after SCI. In addition, high expression of SP also results in the suppression of osteogenesis in SCI rats. Then, the balance between bone resorption and bone formation was broken and finally osteoporosis occurred.