Natural extracellular matrices (ECMs) are viscoelastic and exhibit stress relaxation. However, hydrogels used as synthetic ECMs for three-dimensional (3D) culture are typically elastic. Here, we report a materials approach to tune the rate of stress relaxation of hydrogels for 3D culture, independently of the hydrogel’s initial elastic modulus, cell-adhesion-ligand density and degradation. We find that cell spreading, proliferation, and osteogenic differentiation of mesenchymal stem cells (MSCs) are all enhanced in cells cultured in gels with faster relaxation. Strikingly, MSCs form a mineralized, collagen-1-rich matrix similar to bone in rapidly relaxing hydrogels with an initial elastic modulus of 17 kPa. We also show that the effects of stress relaxation are mediated by adhesion-ligand binding, actomyosin contractility and mechanical clustering of adhesion ligands. Our findings highlight stress relaxation as a key characteristic of cell-ECM interactions and as an important design parameter of biomaterials for cell culture.