Proteasome inhibitors represent a promising therapy for the treatment of relapsed and/or refractory multiple myeloma, a disease that is concomitant with osteolysis and enhanced osteoclast formation. While blockade of the proteosome pathway has been recently shown to influence osteoclast formation and function, the precise molecular cascade underlying these effects is presently unclear. Here, we provide evidence that proteasome inhibitors directly impair osteoclast formation and function via the disruption of key RANK‐mediated signaling cascades. Disruption of the proteosome pathway using selective inhibitors (MG‐132, MG‐115, and epoxomicin) resulted in the accumulation of p62 and CYLD, and altered the subcellular targeting and distribution of p62 and TRAF6 in osteoclast‐like cells. Proteosome inhibition also blocked RANKL‐induced NF‐κB activation, IκBα degradation and nuclear translocation of p65. The disruption in RANK‐signaling correlated dose‐dependently with an impairment in osteoclastogenesis, with relative potency epoxomicin > MG‐132 > MG‐115 based on equimolar concentrations. In addition, these inhibitors were found to impact osteoclastic microtubule organization and attenuate bone resorption. Based on these data we propose that deregulation of key RANK‐mediated signaling cascades (p62, TRAF6, CYLD, and IκBα) underscores proteasome‐mediated inhibition of osteolytic bone conditions. J. Cell. Physiol. 220: 450–459, 2009. © 2009 Wiley‐Liss, Inc.