Bone marrow is found inside the bones in the central cavity. In children, bone barrow in many bones contributes to the production of circulating blood cells. As people age, red marrow is gradually replaced with yellow marrow, to the point that contributions to cell development are isolated to a few flat bones, such as the ribs, sternum and pelvis.
Areas of the marrow that are undergoing 'hematopoiesis' or the process of making circulating blood cells. Hemopoietic stem cells are found in the red marrow and are the precursors of all leukocytes. As cells develop, they migrate from the inside to the outside of the bone marrow.
These areas are not undergoing hematopoiesis, but instead, are involved in the storage of fats. Mesenchymal stem cells can also be found here. These cells can differentiate into those responsible for the the structural integrity and architecture of bone tissues.