Human osteoclast formation from monocyte precursors under the action of receptor activator of nuclear factor-kappaB ligand (RANKL) was suppressed by granulocyte macrophage colony-stimulating factor (GM-CSF), with down-regulation of critical osteoclast-related nuclear factors. GM-CSF in the presence of RANKL and macrophage colony-stimulating factor resulted in mononuclear cells that were negative for tartrate-resistant acid phosphatase (TRAP) and negative for bone resorption. CD1a, a dendritic cell marker, was expressed in GM-CSF, RANKL, and macrophage colony-stimulating factor-treated cells and absent in osteoclasts. Microarray showed that the CC chemokine, monocyte chemotactic protein 1 (MCP-1), was profoundly repressed by GM-CSF. Addition of MCP-1 reversed GM-CSF suppression of osteoclast formation, recovering the bone resorption phenotype. MCP-1 and chemokine RANTES (regulated on activation normal T cell expressed and secreted) permitted formation of TRAP-positive multinuclear cells in the absence of RANKL. However, these cells were negative for bone resorption. In the presence of RANKL, MCP-1 significantly increased the number of TRAP-positive multinuclear bone-resorbing osteoclasts (p = 0.008). When RANKL signaling through NFATc1 was blocked with cyclosporin A, both MCP-1 and RANTES expression was down-regulated. Furthermore, addition of MCP-1 and RANTES reversed the effects of cyclosporin A and recovered the TRAP-positive multinuclear cell phenotype. Our model suggests that RANKL-induced chemokines are involved in osteoclast differentiation at the stage of multinucleation of osteoclast precursors and provides a rationale for increased osteoclast activity in inflammatory conditions where chemokines are abundant.