The classical central macrophage found in erythroblastic islands plays an important role in erythroblast differentiation, proliferation and enucleation in the bone marrow. Convenient human in vitro models to facilitate the study of erythroid-macrophage interactions are desired. Recently, we demonstrated that cultured monocytes/macrophages enhance in vitro erythropoiesis by supporting hematopoietic stem cell survival. Here, we describe that these specific macrophages also support erythropoiesis. Human monocytes cultured in serum-free media supplemented with stem cell factor, erythropoietin, lipids and dexamethasone differentiate towards macrophages expressing CD16, CD163, CD169, CD206, CXCR4 and the phagocytic TAM-receptor family. Phenotypically they resemble both human bone marrow and fetal liver resident macrophages. This differentiation was dependent on glucocorticoid receptor activation. Proteomic studies confirm that glucocorticoid receptor activation differentiates monocytes to anti-inflammatory tissue macrophages with a M2 phenotype, termed GC-macrophages. Proteins involved in migration, tissue residence and signal transduction/receptor activity were upregulated whilst lysosome and hydrolase activity GO-categories were down regulated. Functionally, we demonstrate that GC-macrophages are highly mobile and can interact to form clusters with erythroid cells of all differentiation stages and phagocytose the expelled nuclei recapitulating aspects of erythroblastic islands. In conclusion, glucocorticoid-directed monocyte differentiation to macrophages represent a convenient model system to study erythroid-macrophage interactions.