Mesenchymal stem cells (MSCs) are one of the most attractive cell types for cell-based bone tissue repair applications. Fetal-derived MSCs and maternal-derived MSCs have been isolated from chorionic villi of human term placenta and the decidua basalis attached to the placenta following delivery, respectively. Chorionic-derived MSCs (CMSCs) and decidua-derived MSCs (DMSCs) generated in this study met the MSCs criteria set by International Society of Cellular Therapy. These criteria include: (i) adherence to plastic; (ii) >90% expression of CD73, CD105, CD90, CD146, CD44 and CD166 combined with <5% expression of CD45, CD19 and HLA-DR; and (iii) ability to differentiate into osteogenic, adipogenic, and chondrogenic lineages. In vivo subcutaneous implantation into SCID mice showed that both bromo-deoxyuridine (BrdU)-labelled CMSCs and DMSCs when implanted together with hydroxyapatite/tricalcium phosphate particles were capable of forming ectopic bone at 8-weeks post-transplantation. Histological assessment showed expression of bone markers, osteopontin (OPN), osteocalcin (OCN), biglycan (BGN), bone sialoprotein (BSP), and also a marker of vasculature, alpha-smooth muscle actin (α-SMA). This study provides evidence to support CMSCs and DMSCs as cellular candidates with potent bone forming capacity.