Heterotopic ossification (HO) consists of extraskeletal bone formation. One form of HO is acquired and instigated by traumas or surgery, and another form is genetic and characterizes fibrodysplasia ossificans progressiva (FOP). Recently, we and others showed that activin A promotes both acquired and genetic HO, and in previous studies we found that the retinoid agonist palovarotene inhibits both HO forms in mice. Here, we asked whether palovarotene's action against HO may include an interference with endogenous activin A expression and/or function. Using a standard mouse model of acquired HO, we found that activin A and its encoding RNA (Inhba) were prominent in chondrogenic cells within developing HO masses in untreated mice. Single-cell RNAseq (scRNAseq) assays verified that Inhba expression characterized chondroprogenitors and chondrocytes in untreated HO, in addition to its expected expression in inflammatory cells and macrophages. Palovarotene administration (4 mg/kg/d/gavage) caused a sharp inhibition of both HO and amounts of activin A and Inhba transcripts. Bioinformatic analyses of scRNAseq data sets indicated that the drug had reduced interactions and cross-talk among local cell populations. To determine if palovarotene inhibited Inhba expression directly, we assayed primary chondrocyte cultures. Drug treatment inhibited their cartilaginous phenotype but not Inhba expression. Our data reveal that palovarotene markedly reduces the number of local Inhba-expressing HO-forming cell populations. The data broaden the spectrum of HO culprits against which palovarotene acts, accounting for its therapeutic effectiveness. © 2023 The Authors. JBMR Plus published by Wiley Periodicals LLC on behalf of American Society for Bone and Mineral Research.