Bioreactors can be used to apply fluid flow in vitro to scaffolds to improve mass transport of media and apply mechanical forces to cells. In this study, we developed and tested an autoclavable, modular perfusion bioreactor suitable for large scaffolds. We investigated the effects of fluid flow induced shear stress (FFSS) on osteogenic differentiation of human embryonic stem cell-derived mesenchymal progenitors (hES-MP cells) cultured on large polyurethane (PU) scaffolds (30 mm diameter x 5 mm thickness) in osteogenesis induction media (OIM). After seeding, scaffolds were either maintained in static conditions or transferred to the bioreactor 3 days post-seeding and a continuous flow rate of 3.47 mL/min was applied. Alkaline phosphatase activity (ALP) was used to evaluate osteogenic differentiation and resazurin salt reduction (RR) to measure metabolic activity after 10 days. Cultures subjected to flow contained significantly more metabolically active cells and higher total DNA content, as well as significantly higher ALP activity compared to scaffolds grown in static culture. These results confirm the responsiveness of hES-MP cells to fluid flow stimuli, and present a cost-effective, user-friendly bioreactor capable of supporting the growth and differentiation of mesenchymal progenitor cells within scaffolds capable of filling large bone defects.