Aged skeletal muscle is markedly affected by fatty muscle infiltration, and strategies to reduce the occurrence of intramuscular adipocytes are urgently needed. Here, we show that fibroblast growth factor-2 (FGF-2) not only stimulates muscle growth but also promotes intramuscular adipogenesis. Using multiple screening assays upstream and downstream of microRNA (miR)-29a signaling, we located the secreted protein and adipogenic inhibitor SPARC to an FGF-2 signaling pathway that is conserved between skeletal muscle cells from mice and humans and that is activated in skeletal muscle of aged mice and humans. FGF-2 induces the miR-29a/SPARC axis through transcriptional activation of FRA-1, which binds and activates an evolutionary conserved AP-1 site element proximal in the miR-29a promoter. Genetic deletions in muscle cells and adeno-associated virus–mediated overexpression of FGF-2 or SPARC in mouse skeletal muscle revealed that this axis regulates differentiation of fibro/adipogenic progenitors in vitro and intramuscular adipose tissue (IMAT) formation in vivo. Skeletal muscle from human donors aged >75 y versus <55 y showed activation of FGF-2–dependent signaling and increased IMAT. Thus, our data highlights a disparate role of FGF-2 in adult skeletal muscle and reveals a pathway to combat fat accumulation in aged human skeletal muscle.