<p>Bone organoids mimic the structure and function of actual bone tissue and serve as novel tools for disease modeling, drug testing, and bone repair. However, their development is severely impeded by the limited availability of cell sources. Fortunately, human pluripotent stem cells (hPSCs) can differentiate into organoid constituent cells, including osteoblasts, osteoclasts, and endothelial cells. However, their differentiation efficiencies are relatively low and do not meet the requirements of clinical applications because of the use of undefined culture components such as fetal bovine serum. More importantly, nearly all the existing scaffolds cannot support the culture of hPSCs. Thus, much effort should be made to construct bone organoids using cells induced from hPSCs. This review starts with the in vivo development of bone tissue. We summarize the mechanisms, methods, and purification processes for differentiating hPSCs into the above cell types in bone organoids. On this basis, we described strategies related to hPSC-based bone organoids and the growth factors and bioactive materials needed to accelerate this process. Finally, we extensively discuss the existing challenges and prospects. This review is valuable for the future development and clinical application of hPSC-derived bone organoids.</p> Graphical Abstract <p></p>