Bone marrow has indisputable biological importance as the primary site of blood and immune cell formation which is necessary throughout life. As such, significant progress has been made towards dissecting the complexities of the bone marrow niche to harness its clinical potential, with preclinical development centered on murine models to investigate the biology of the bone marrow niche. With this, emerging evidence has demonstrated that bone marrow adipocytes rapidly accumulating in bony cavities during aging with concomitant decreases in bone mineralization and structural integrity. However, due to the limited anatomical accessibility of the inner bone space, direct observation of the role and function of bone marrow adipose tissue during homeostasis and disease is limited. Resultantly, how bone marrow adipocytes affect bone remodeling remains poorly characterized. Here, we report the development of an integrated in vitro bone and marrow model to quantify and determine the impacts of bone marrow adipocytes on both the pathophysiology of tumor cell relapse and bone remodeling. To this end, we first established protocols for the isolation and differentiation of primary mesenchymal stromal cells (MSC) to establish a mature adipocyte enriched marrow microenvironment using a robust and rapid chemically defined differentiation method. Next, we independently recapitulated the native bone surface by utilizing demineralized bone paper (DBP), a mechanically durable, semitransparent biomaterial derived from compact bovine bone which retains the hierarchical architecture of collagen fibers and mimics the native osteoid surface, which is subsequently remineralized by primary osteoblasts. Last, we integrated these two distinct microenvironments into a single niche by fabricating an optically transparent cell culture insert that fits standardized cell culture well plates to enable quantitative spatial imaging of this microfabricated bone marrow microenvironment. With these models, we report that the sequestration of the lipophilic chemotherapeutic doxorubicin by fat droplets reduces its cytotoxicity and efficacy. In addition, we further demonstrate that in a bone and marrow coculture model, uptake of vitamin D3 by lipid droplets regulates the formation of osteoclasts and subsequently resorption kinetics of mineralized DBP. Taken together, these results substantiate the utility of bioengineered materials to capture native tissue complexity and decouple the role of sequestration and secretion by bone marrow adipocytes towards tumor cell relapse and bone remodeling. Ultimately, we view that rationally designed and microfabricated in vitro models with high analytical power and prognostic capability opens the door for new areas, such as 1) developing insight into how cellular components in the bone marrow microenvironment orchestrate therapeutic resistance, 2) provides new orthogonal opportunities to combat tumor relapse with a novel in vitro assay platform, and 3) holds potential for mechanistically understanding how changes in the cellular microenvironment promotes other diseases such as osteoporosis and bone loss during aging.