Vitamin D works at three sites in the body to regulate Calcium levels.
So Vitamin D's primary effect is to increase the availability of Calcium for absorption. Without the help of Vitamin D, levels of Calcium in the blood, and ultimately in the bone, could be negatively affected.
Vitamin D's direct effect on bone building is demonstrated by the tendency of bone mass to fall faster during the winter and remain fairly stable in the summer, particularly in (but not limited to) northern climates. Research by Dr. Dawson-Hughes and colleagues suggests this seasonal acceleration in bone loss may be offset by supplementation with Vitamin D (and other studies[2,3] suggest that adding Calcium may provide additional benefits). Another benefit of Vitamin D is that it improves muscle strength and balance so people are less likely to fall. That may be why fracture risk decreases fairly quickly when elderly people start taking Calcium and Vitamin D, even when bone density has not increased significantly.