Osteosarcoma is the most common malignancy of bone that occurs in young adults and children, with a five-year survival rate of 60-70%. Metastasis of osteosarcoma maintains an even poorer prognosis. GREM1 plays an important role in regulating organogenesis, body patterning, and tissue differentiation. However, there are limited studies on GREM1 in osteosarcomas. This study was carried out to characterize the expression and function of GREM1 in osteosarcoma cells, thus extending our understanding of osteosarcoma metastasis. GREM1 expression was detected in hBMSC, hFOB1.19, Saos-2, MG63 and U2OS cell lines using quantitative real-time polymerase chain reaction (qRT-PCR) and Western blot analysis. Gain- and loss-of-function approaches were used to assess the biological function of GREM1 in U2OS cells. The effects of GREM1 on U2OS cell proliferation were examined using the CCK-8 and colony formation assay. Migration and invasion ability were confirmed by the wound healing and Transwell assay, respectively. Flow cytometry was used to analyse the effect of GREM1 on the cell cycle and apoptosis. The expression of GREM1 targets was evaluated by qRT-PCR and western blotting. The expression of GREM1 was significantly downregulated in osteosarcoma. GREM1 overexpression inhibited the proliferation, migration and invasion of U2OS cells. GREM1 overexpression suppressed tumour cell-induced endothelial cell migration and invasion ability. The effect of GREM1 may be transduced through regulation of the BMP target transcription factor inhibitor of MMP-2 and -9 as well as Id1. GREM1 overexpression and knockdown regulates the tumorigenesis of osteosarcoma in vivo. In conclusion, GREM1 is downregulated in osteosarcoma cells, and overexpression of GREM1 inhibits the proliferation, migration, invasion and angiogenesis abilities of osteosarcoma cells in vitro and in vivo.