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The characteristic toughness and strength of bone result from the nature of bone matrix, the mineralized extracellular matrix produced by osteoblasts. The mechanical properties and composition of bone matrix, along with bone mass and architecture, are critical determinants of a bone's ability to resist fracture. Several regulators of bone mass and architecture have been identified, but factors that regulate the mechanical properties and composition of bone matrix are largely unknown. We used a combination of high-resolution approaches, including atomic-force microscopy, x-ray tomography, and Raman microspectroscopy, to assess the properties of bone matrix independently of bone mass and architecture. Properties were evaluated in genetically modified mice with differing levels of TGF-beta signaling. Bone matrix properties correlated with the level of TGF-beta signaling. Smad3+/- mice had increased bone mass and matrix properties, suggesting that the osteopenic Smad3-/- phenotype may be, in part, secondary to systemic effects of Smad3 deletion. Thus, a reduction in TGF-beta signaling, through its effector Smad3, enhanced the mechanical properties and mineral concentration of the bone matrix, as well as the bone mass, enabling the bone to better resist fracture. Our results provide evidence that bone matrix properties are controlled by growth factor signaling.