Alcohol can induce adipogenesis by bone marrow stromal cells and may cause osteonecrosis of the femoral head. Currently, there are no medications available to prevent alcohol-induced osteonecrosis. We hypothesized puerarin, a Chinese herbal medicine with antioxidative and antithrombotic effects, can prevent alcohol-induced adipogenesis and osteonecrosis. Both bone marrow stromal cells (in vitro) and mice (in vivo) were treated either with ethanol or with ethanol and puerarin, with an untreated group serving as a control. In the in vitro study, the number of adipocytes, contents of triglycerides, and levels of PPARγ mRNA expression were decreased and alkaline phosphatase activity, contents of osteocalcin, and levels of osteocalcin mRNA expression were increased in cells treated with both alcohol and puerarin, compared with cells treated with alcohol only. In the in vivo study, marrow necrosis, fat cell hypertrophy and proliferation, thinner and sparse trabeculae, diminished hematopoiesis, and increased empty osteocyte lacunae in the subchondral region of the femoral head were observed in mice treated with alcohol. However, no such changes were seen in femoral heads of mice treated with alcohol and puerarin. The data suggest puerarin can inhibit adipogenic differentiation by bone marrow stromal cells both in vitro and in vivo and prevents alcohol-induced osteonecrosis in this model.