Microtubule organization and lysosomal secretion are both critical for the activation and function of osteoclasts, highly specialized polykaryons that are responsible for bone resorption and skeletal homeostasis. Here, we have identified a novel interaction between microtubule regulator LIS1 and Plekhm1, a lysosome-associated protein implicated in osteoclast secretion. Decreasing LIS1 expression by shRNA dramatically attenuated osteoclast formation and function, as shown by a decreased number of mature osteoclasts differentiated from bone marrow macrophages, diminished resorption pits formation, and reduced level of CTx-I, a bone resorption marker. The ablated osteoclast formation in LIS1-depleted macrophages was associated with a significant decrease in macrophage proliferation, osteoclast survival and differentiation, which were caused by reduced activation of ERK and AKT by M-CSF, prolonged RANKL-induced JNK activation and declined expression of NFAT-c1, a master transcription factor of osteoclast differentiation. Consistent with its critical role in microtubule organization and dynein function in other cell types, we found that LIS1 binds to and colocalizes with dynein in osteoclasts. Loss of LIS1 led to disorganized microtubules and aberrant dynein function. More importantly, the depletion of LIS1 in osteoclasts inhibited the secretion of Cathepsin K, a crucial lysosomal hydrolase for bone degradation, and reduced the motility of osteoclast precursors. These results indicate that LIS1 is a previously unrecognized regulator of osteoclast formation, microtubule organization, and lysosomal secretion by virtue of its ability to modulate dynein function and Plekhm1.