Bavachinin (BVC), a prenylated flavonoid from Psoralea corylifolia seeds, is a reported natural PPAR agonist, but its metabolic efficacy and potential skeletal effects are unclear. This study examined the functional actions of BVC across various metabolic, inflammatory, and skeletal systems. BVC moderately activated PPAR, enhanced aP2 expression, and promoted adipogenic differentiation in hMSCs and in a de novo fat pad model. In high-fat diet-induced obese mice, BVC improved glucose tolerance and insulin sensitivity, restored Ser273-dependent PPAR target gene expression, and inhibited PPAR phosphorylation at Ser273 without inducing TZD-like side effects such as fluid retention, cardiac hypertrophy, or ENaC upregulation. BVC also suppressed pro-inflammatory cytokine expression and nitric oxide production in adipocytes, macrophages, and adipose tissue. In contrast to its metabolic benefits, BVC inhibited the osteoblast differentiation of hMSCs and impaired bone regeneration in a rat calvarial defect model. Hence, BVC acts as a selective PPAR modulator with metabolic and anti-inflammatory benefits but has adverse skeletal effects, highlighting its therapeutic potential benefits but noting important safety considerations regarding its use.