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C1q/TNF‐related protein 3 (CTRP3) is a cytokine known to regulate a variety of metabolic processes. Though previously undescribed in the context of bone regeneration, high throughput gene expression experiments in mice identified CTRP3 as one of the most highly upregulated genes in fracture callus tissue. Hypothesizing a positive regulatory role for CTRP3 in bone regeneration, we phenotyped skeletal development and fracture healing in CTRP3 knockout (KO) and CTRP3 overexpressing transgenic (TG) mice relative to wild‐type (WT) control animals. CTRP3 KO mice experienced delayed endochondral fracture healing, resulting in abnormal mineral distribution, the presence of periosteal marrow compartments, and a nonunion‐like state. Decreased osteoclast number was also observed in CTRP3 KO mice, whereas CTRP3 TG mice underwent accelerated callus remodeling. Gene expression profiling revealed a broad impact on osteoblast/osteoclast lineage commitment and metabolism, including arrested progression toward mature skeletal lineages in the KO group. A single systemic injection of CTRP3 protein at the time of fracture was insufficient to phenocopy the chronic TG healing response in WT mice. By associating CTRP3 levels with fracture healing progression, these data identify a novel protein family with potential therapeutic and diagnostic value. © 2019 Orthopaedic Research Society. Published by Wiley Periodicals, Inc. J Orthop Res 38:00‐19966, 2020 [ABSTRACT FROM AUTHOR]