Overexpression of transforming growth factor-beta 1 (TGF-β1) and subchondral bone remodelling play key roles in osteoarthritis (OA). Raloxifene (RAL) reduces the serum level of TGF-β1 in postmenopausal women. However, the effect of RAL on TGF-β1 expression in articular cartilage is still unclear. Therefore, we aimed to investigate the protective effect of RAL on osteoporotic osteoarthritis via affecting TGF-β1 expression in cartilage and the metabolism of subchondral bone. Osteoporotic osteoarthritis was induced by a combination of anterior cruciate transection (ACLT) and ovariectomy (OVX). Rats were divided into five groups (n = 12): The sham group, the ACLT group, the OVX group, the ACLT + OVX group, and the RAL group (ACLT + OVX + RAL, 6.25 mg/kg/day for 12 weeks). Assessment was performed by histomorphology, microcomputed tomography (micro-CT) scan, immunohistochemistry, and tartrate-resistant acid phosphatase (TRAP) staining. We found that severe cartilage degeneration was shown in the ACLT + OVX group. The histomorphological scores, the levels of TGF-β1, and its related catabolic enzymes and osteoclasts numbers in the ACLT + OVX group were higher than those in other groups (p < 0.05). Furthermore, structure model index (SMI) and trabecular spacing (Tb.Sp) were decreased (p < 0.05), while bone mineral density (BMD), bone volume fraction (BV/TV), and trabecular number (Tb.N) were increased by RAL compared with the ACLT + OVX group (p < 0.05). Our findings demonstrated that RAL in clinical doses retards the development of osteoporotic osteoarthritis by inhibiting the overexpression of TGF-β1 in cartilage and regulating the metabolism of subchondral bone. These results provide support for RAL in the expansion of clinical indication for prevention and treatment in postmenopausal osteoarthritis.