The patterning and ossification of the mammalian skeleton requires the coordinated actions of both intrinsic bone morphogens and extrinsic neurovascular signals, which function in a temporal and spatial fashion to control mesenchymal progenitor cell (MPC) fate. Here, we show the genetic inhibition of tropomyosin receptor kinase A (TrkA) sensory nerve innervation of the developing cranium results in premature calvarial suture closure, associated with a decrease in suture MPC proliferation and increased mineralization. In vitro, axons from peripheral afferent neurons derived from dorsal root ganglions (DRGs) of wild-type mice induce MPC proliferation in a spatially restricted manner via a soluble factor when cocultured in microfluidic chambers. Comparative spatial transcriptomic analysis of the cranial sutures in vivo confirmed a positive association between sensory axons and proliferative MPCs. SpatialTime analysis across the developing suture revealed regional-specific alterations in bone morphogenetic protein (BMP) and TGF-β signaling pathway transcripts in response to TrkA inhibition. RNA sequencing of DRG cell bodies, following direct, axonal coculture with MPCs, confirmed the alterations in BMP/TGF-β signaling pathway transcripts. Among these, the BMP inhibitor follistatin-like 1 (FSTL1) replicated key features of the neural-to-bone influence, including mitogenic and anti-osteogenic effects via the inhibition of BMP/TGF-β signaling. Taken together, our results demonstrate that sensory nerve-derived signals, including FSTL1, function to coordinate cranial bone patterning by regulating MPC proliferation and differentiation in the suture mesenchyme.