Germline mutations in the NF1 tumor suppressor gene cause neurofibromatosis type 1 (NF1), a complex genetic disorder with a high predisposition of numerous skeletal dysplasias including short stature, osteoporosis, kyphoscoliosis, and fracture non-union (pseudoarthrosis). We have developed murine models that phenocopy many of the skeletal dysplasias observed in NF1 patients, including reduced bone mass and fracture non-union. We also show that the development of these skeletal manifestations requires an Nf1 haploinsufficient background in addition to nullizygous loss of Nf1 in mesenchymal stem/progenitor cells (MSCs) and/or their progenies. This is replicated in two animal models of NF1, PeriCre(+);Nf1(flox/-) and Col2.3Cre(+);Nf1(flox/-) mice. Adoptive transfer experiments demonstrate a critical role of the Nf1+/- marrow microenvironment in the impaired fracture healing in both models and adoptive transfer of WT bone marrow cells improves fracture healing in these mice. To our knowledge, this is the first demonstration of a non-cell autonomous mechanism in non-malignant NF1 manifestations. Collectively, these data provide evidence of a combinatory effect between nullizygous loss of Nf1 in osteoblast progenitors and haploinsufficiency in hematopoietic cells in the development of non-malignant NF1 manifestations.