Activation of Wnt signaling leads to high bone density. The R-spondin family of four secreted glycoproteins (Rspo1-4) amplifies Wnt signaling. In humans, RSPO3 variants are strongly associated with bone density, but how RSPO3 affects skeletal homeostasis is not fully understood. Here we show that in mice Rspo3 haplo-insufficiency or its targeted deletion in osteoprogenitors lead to an increase in bone formation and bone mass. Contrary to expectations, Rspo3 haplo-insufficiency results in canonical Wnt signaling activation. Using mouse embryonic fibroblasts we show that Rspo3 deficiency leads to activation of Erk signaling, stabilizing β-catenin. Furthermore, Rspo3 haplo-insufficiency impairs Dkk1 efficacy in blocking canonical Wnt signaling and prevents the in vivo inhibition of bone formation and bone mass induced by osteoblast-targeted expression of Dkk1. We conclude that Rspo3 haplo-insufficiency/deficiency boosts canonical Wnt signaling by activating Erk signaling and impairing Dkk1’s inhibitory activity, which in turn lead to increased bone formation and bone mass.