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Haematopoietic ageing is marked by a loss of regenerative capacity and skewed differentiation from haematopoietic stem cells (HSCs), leading to impaired blood production. Signals from the bone marrow niche tailor blood production, but the contribution of the old niche to haematopoietic ageing remains unclear. Here we characterize the inflammatory milieu that drives both niche and haematopoietic remodelling. We find decreased numbers and functionality of osteoprogenitors at the endosteum and expansion of central marrow LepR mesenchymal stromal cells associated with deterioration of the sinusoidal vasculature. Together, they create a degraded and inflamed old bone marrow niche. Niche inflammation in turn drives the chronic activation of emergency myelopoiesis pathways in old HSCs and multipotent progenitors, which promotes myeloid differentiation and hinders haematopoietic regeneration. Moreover, we show how production of interleukin-1β (IL-1β) by the damaged endosteum acts in trans to drive the proinflammatory nature of the central marrow, with damaging consequences for the old blood system. Notably, niche deterioration, HSC dysfunction and defective regeneration can all be ameliorated by blocking IL-1 signalling. Our results demonstrate that targeting IL-1 as a key mediator of niche inflammation is a tractable strategy to improve blood production during ageing.