The periosteum is critical for bone repair and contains skeletal stem cells (SSCs), but these cells are still poorly characterized. In the bone marrow, cells expressing the Nes-GFP transgene have been described to be SSCs. Here, we investigated whether Nes-GFP expression also typifies SSCs in the periosteum. We show that in adult mice, Nes-GFP cells are present in the periosteum and localize closely to blood vessels, but periosteal Nes-GFP cells express SSC and progenitor markers differently compared to Nes-GFP cells in the bone marrow. Periosteal Nes-GFP cells show in vitro clonogenicity and tri-lineage differentiation potential and they can form bone in vivo. Shortly after fracture, they start to proliferate and they contribute to the osteoblast pool during the repair process. However, periosteal Nes-GFP cells are not slow dividing nor self-renewing in vivo. These results indicate that in adult mice, periosteal Nes-GFP expressing cells are skeletal progenitors rather than true SSCs, and they participate in the fracture healing process.