The transcription factor family member NFAT plays an important role in the regulation of osteoclast differentiation. However, the role of NFAT in osteoclasts in vivo is still not fully understood. Thus, we generated transgenic mice in which constitutively active-NFAT1/NFATc2 (CA-NFAT1) is specifically expressed in the osteoclast lineage, using the tartrate-resistant acid phosphatase gene promoter. Both x-ray and histological analyses demonstrated an osteopenic bone phenotype in the CA-NFAT1 transgenic mice, whereas the number of tartrate-resistant acid phosphatase-positive osteoclasts was markedly higher in the long bones of these mice. Furthermore, the bone-resorbing activity of mature osteoclasts derived from the transgenic mice was much higher than that of wild-type mice. Interestingly, the introduction of CA-NFAT1 into osteoclasts or RAW264 cells increased the expression and activity of c-Src and stimulated actin ring formation. In contrast, CA-NFAT1 or GFP-tagged VIVIT peptide, a specific inhibitor of NFAT, did not affect the survival of mature osteoclasts. Collectively, our data indicate that NFAT controls bone resorption in vivo by stimulating the differentiation and functioning of osteoclasts but not their survival.