Aims. Astragalus polysaccharide (APS) participates in various processes, such as the enhancement of immunity and inhibition of tumours. APS can affect osteoporosis (OP) by regulating the osteogenic differentiation of human bone mesenchymal stem cells (hBMSCs). This study was designed to elucidate the mechanism of APS in hBMSC proliferation and osteoblast differentiation. Methods. Reverse transcriptase polymerase chain reaction (RT-PCR) and Western blotting were performed to determine the expression of microRNA (miR)-760 and ankyrin repeat and FYVE domain containing 1 (ANKFY1) in OP tissues and hBMSCs. Cell viability was measured using the Cell Counting Kit-8 assay. The expression of cyclin D1 and osteogenic marker genes (osteocalcin (OCN), alkaline phosphatase (ALP), and runt-related transcription factor 2 (RUNX2)) was evaluated using quantitative reverse transcriptase polymerase chain reaction (qRT-PCR). Mineral deposits were detected through Alizarin Red S staining. In addition, Western blotting was performed to detect the ANKFY1 protein levels following the regulation of miR-760. The relationship between miR-760 and ANKFY1 was determined using a luciferase reporter assay. Results. The expression of miR-760 was upregulated in OP tissues, whereas ANKFY1 expression was downregulated. APS stimulated the differentiation and proliferation of hBMSCs by: increasing their viability; upregulating the expression levels of cyclin D1, ALP, OCN, and RUNX2; and inducing osteoblast mineralization. Moreover, APS downregulated the expression of miR-760. Overexpression of miR-760 was found to inhibit the promotive effect of APS on hBMSC differentiation and proliferation, while knockdown of miR-760 had the opposite effect. ANKFY1 was found to be the direct target of miR-760. Additionally, ANKFY1 participated in the APS-mediated regulation of miR-760 function in hBMSCs. Conclusion. APS promotes the osteogenic differentiation and proliferation of hBMSCs. Moreover, APS alleviates the effects of OP by downregulating miR-760 and upregulating ANKFY1 expression. Cite this article: Bone Joint Res 2023;12(8):476–485