Osteoclasts are large, multinucleated, terminally differentiated cells formed by the fusion of mononuclear hemopoietic precursors. Their function is the resorption of bone, which is an essential part of the growth, modeling and remodeling of the skeleton. Though some osteoclast differentiation factors have recently been identified, the molecular basis for the fusion process that leads to multinucleation is poorly understood. The ATP-gated P2X7 receptor is a plasma membrane receptor belonging to the family of P2X purinergic receptors. It is known to be expressed by cells of hemopoietic origin where its activation leads to multiple downstream events including cytokine release, cell permeabilization and apoptosis. More recently this receptor has been implicated in the generation of multinucleated giant cells and polykaryons. Here we show that human osteoclasts express P2X7 receptors in vitro and in vivo, and that these receptors are functional in vitro, as assessed by pore-formation studies. More importantly, blockade of the P2X7 receptor with the antagonist oxidized ATP or a blocking monoclonal antibody significantly inhibits the fusion of osteoclast precursors to form multinucleated osteoclasts. Taken in combination with previous results from our laboratory demonstrating P2X7 receptor-mediated apoptosis and inhibition of bone resorption in vitro, these data suggest an important role for the P2X7 receptor in the regulation of the osteoclast population. The P2X7 receptor provides a significant new target for modulating osteoclast function in diseases characterized by increased osteoclast number and excessive bone turnover.