Cysteine‐rich with epidermal growth factor (EGF)‐like domains 2 (CRELD2) is an endoplasmic reticulum (ER)‐resident chaperone highly activated under ER stress in conditions such as chondrodysplasias;​ however, its role in healthy skeletal development is unknown. We show for the first time that cartilage‐specific deletion of Creld2 results in disrupted endochondral ossification and short limbed dwarfism, whereas deletion of Creld2 in bone results in osteopenia, with a low bone density and altered trabecular architecture. Our study provides the first evidence that CRELD2 promotes the differentiation and maturation of skeletal cells by modulating noncanonical WNT4 signaling regulated by p38 MAPK. Furthermore, we show that CRELD2 is a novel chaperone for the receptor low‐density lipoprotein receptor‐related protein 1 (LRP1), promoting its transport to the cell surface, and that LRP1 directly regulates WNT4 expression in chondrocytes through TGF‐β1 signaling. Therefore, our data provide a novel link between an ER‐resident chaperone and the essential WNT signaling pathways active during skeletal differentiation that could be applicable in other WNT‐responsive tissues.