The morphogenetic and differentiation events required for bone formation are orchestrated by diffusible and insoluble factors that are localized within the extracellular matrix. In mice, the deletion of ICAP-1, a modulator of β1 integrin activation, leads to severe defects in osteoblast proliferation, differentiation, and mineralization and to a delay in bone formation. Deposition of fibronectin and maturation of fibrillar adhesions, adhesive structures that accompany fibronectin deposition, are impaired upon ICAP-1 loss, as are type I collagen deposition and mineralization. Expression of β1 integrin with a mutated binding site for ICAP-1 recapitulates the ICAP-1-null phenotype. Follow-up experiments demonstrated that ICAP-1 negatively regulates kindlin-2 recruitment onto the β1 integrin cytoplasmic domain, whereas an excess of kindlin-2 binding has a deleterious effect on fibrillar adhesion formation. These results suggest that ICAP-1 works in concert with kindlin-2 to control the dynamics of β1 integrin-containing fibrillar adhesions and, thereby, regulates fibronectin deposition and osteoblast mineralization.