Extracellular nucleotides, released in response to mechanical or inflammatory stimuli, signal through P2 receptors in many cell types, including osteoblasts. P2X7 receptors are ATP-gated cation channels that can induce formation of large membrane pores. Disruption of the gene encoding the P2X7 receptor leads to decreased periosteal bone formation and insensitivity of the skeleton to mechanical stimulation. Our purpose was to investigate signaling pathways coupled to P2X7 activation in osteoblasts. Live cell imaging showed that ATP or 2 ',3 '-O-(4-benzoylbenzoyl)-ATP (BzATP), but not UTP, UDP, or 2-methylthio-ADP, induced dynamic membrane blebbing in calvarial osteoblasts. Blebbing was observed in calvarial cells from wildtype but not P2X7 knock-out mice. P2X7 receptors coupled to activation of phospholipase D and A2, inhibition of which suppressed BzATP-induced blebbing. Activation of these phospholipases leads to production of lysophosphatidic acid (LPA). LPA caused dynamic blebbing in osteoblasts from both wild-type and P2X7 knock-out mice, similar to that induced by BzATP in wildtype cells. However, LPA-induced blebbing was more rapid in onset and was not affected by inhibition of phospholipase D or A2. Blockade or desensitization of LPA receptors suppressed blebbing in response to LPA and BzATP, without affecting P2X7-stimulated pore formation. Thus, LPA functions downstream of P2X7 receptors to induce membrane blebbing. Furthermore, inhibition of Rho-associated kinase abolished blebbing induced by both BzATP and LPA. In summary, we propose a novel signaling axis that links P2X7 receptors through phospholipases to production of LPA and activation of Rho-associated kinase. This pathway may contribute to P2X7-stimulated osteogenesis during skeletal development and mechanotransduction.