This study investigated osteogenesis of human mesenchymal stem cells encapsulated in matrix-metalloproteinase (MMP)-sensitive poly(ethylene glycol) (PEG) hydrogels in chemically defined medium (10ng/ml bone morphogenic factor-2). Thiol-norbornene photoclick hydrogels were formed with CRGDS and crosslinkers of PEG dithiol (nondegradable), CVPLS-LYSGC (P1) or CRGRIGF-LRTDC (P2; dash indicates cleavage site) at two crosslink densities. Exogenous MMP-2 degraded P1 and P2 hydrogels similarly. MMP-14 degraded P1 hydrogels more rapidly than P2 hydrogels. Cell spreading was greatest in P1 low crosslinked hydrogels and to a lesser degree in P2 low crosslinked hydrogels, but not evident in nondegradable and high crosslinked MMP-sensitive hydrogels. Early osteogenesis (Alkaline phosphatase [ALP] activity) was accelerated in hydrogels that facilitated cell spreading. Contrarily, late osteogenesis (mineralization) was independent of cell spreading. Mineralized matrix was present in P1 hydrogels, but only present in P2 high crosslinked hydrogels and not yet present in nondegradable hydrogels. Overall, the low crosslinked P1 hydrogels exhibited an accelerated early and late osteogenesis with the highest ALP activity(Day 7), greatest calcium content(Day 14), and greatest collagen content(Day 28), concomitant with increased compressive modulus over time. Collectively, this study demonstrates that in chemically defined medium, hydrogel degradability is critical to accelerating early osteogenesis, but other factors are important in late osteogenesis.