Klotho is an aging‐suppressor gene. The purpose of this study was to investigate whether Klotho deficiency affects arterial structure. We found that Klotho‐deficient (kl/kl) mice developed severe arterial calcification and elastin fragmentation. Klotho‐deficient mice demonstrated higher levels of bone morphogenetic proteins (BMP2, BMP4) and runt‐related transcription factor 2 (RUNX2) in aortas, indicating that Klotho deficiency upregulates expression of BMP2 and RUNX2 (a key transcription factor in osteoblasts). To exclude the potential involvement of hyperphosphatemia in arterial calcification, Klotho‐deficient mice were given a low phosphate diet (0.2%). The low phosphate diet normalized blood phosphate levels and abolished calcification in the lungs and kidneys, but it did not prevent calcification in the aortas in Klotho‐deficient mice. Thus, Klotho deficiency per se might play a causal role in the pathogenesis of arterial calcification, which is independent of hyperphosphatemia. In cultured mouse aortic smooth muscle cells (ASMCs), Klotho‐deficient serum‐induced transition of ASMCs to osteoblasts. Klotho‐deficient serum promoted BMP2/vitamin D3‐induced protein expression of PIT2 and RUNX2, phosphorylation of SMAD1/5/8 and SMAD2/3, and extracellular matrix calcification. Interestingly, treatments with recombinant Klotho protein abolished BMP2/vitamin D3‐induced osteoblastic transition and morphogenesis and calcification. Therefore, Klotho is a critical regulator in the maintenance of normal arterial homeostasis. Klotho deficiency‐induced arterial calcification is an active process that involves the osteoblastic transition of SMCs and activation of the BMP2‐RUNX2 signaling.