We have previously shown that mice lacking the TSH receptor (TSHR) exhibit osteoporosis due to enhanced osteoclast formation. The fact that this enhancement is not observed in double-null mice of TSHR and TNFalpha suggests that TNFalpha overexpression in osteoclast progenitors (macrophages) may be involved. It is unknown how TNFalpha expression is regulated in osteoclastogenesis. Here, we describe a receptor activator for nuclear factor-kappaB ligand (RANKL)-responsive sequence (CCG AGA CAG AGG TGT AGG GCC), spanning from -157 to -137 bp of the 5'-flanking region of the TNFalpha gene, which functions as a cis-acting regulatory element. We further show how RANKL treatment stimulates the high-mobility group box proteins (HMGB) HMGB1 and HMGB2 to bind the RANKL-responsive sequence and up-regulates TNFalpha transcription. Exogenous HMGB elicits the expression of cytokines, including TNFalpha, as well as osteoclast formation. Conversely, TSH inhibits the expression of HMGB and TNFalpha and the formation of osteoclasts. These results suggest that HMGB play a pivotal role in osteoclastogenesis. We also show a direct correlation between the expression of HMGB and TNFalpha and osteoclast formation in TSHR-null mice and TNFalpha-null mice. Taken together, we conclude that HMGB and TNFalpha play critical roles in the regulation of osteoclastogenesis and the remodeling of bone.