Receptor activator of NF-kappaB ligand (RANKL) plays an essential role in osteoclast formation and bone resorption. Although genetic and biochemical studies indicate that RANKL regulates osteoclast differentiation by activating receptor activator of NF-kappaB and associated signaling molecules, the molecular mechanisms of RANKL-regulated osteoclast differentiation have not yet been fully established. We investigated the role of the transcription factor c-Jun, which is activated by RANKL, in osteoclastogenesis using transgenic mice expressing dominant-negative c-Jun specifically in the osteoclast lineage. We found that the transgenic mice manifested severe osteopetrosis due to impaired osteoclastogenesis. Blockade of c-Jun signaling also markedly inhibited soluble RANKL-induced osteoclast differentiation in vitro. Overexpression of nuclear factor of activated T cells 1 (NFAT1) (NFATc2/NFATp) or NFAT2 (NFATc1/NFATc) promoted differentiation of osteoclast precursor cells into tartrate-resistant acid phosphatase-positive (TRAP-positive) multinucleated osteoclast-like cells even in the absence of RANKL. Overexpression of NFAT1 also markedly transactivated the TRAP gene promoter. These osteoclastogenic activities of NFAT were abrogated by overexpression of dominant-negative c-Jun. Importantly, osteoclast differentiation and induction of NFAT2 expression by NFAT1 overexpression or soluble RANKL treatment were profoundly diminished in spleen cells of the transgenic mice. Collectively, these results indicate that c-Jun signaling in cooperation with NFAT is crucial for RANKL-regulated osteoclast differentiation.