Bone destruction is a pathological hallmark of several chronic inflammatory diseases, including rheumatoid arthritis and periodontitis. Inflammation-induced bone loss of this sort results from elevated numbers of bone-resorbing osteoclasts. Gene targeting studies have shown that the transcription factor nuclear factor-κB (NF-κB) has a crucial role in osteoclast differentiation, and blocking NF-κB is a potential strategy for preventing inflammatory bone resorption. We tested this approach using a cell-permeable peptide inhibitor of the IκB-kinase complex, a crucial component of signal transduction pathways to NF-κB. The peptide inhibited RANKL-stimulated NF-κB activation and osteoclastogenesis both in vitro and in vivo. In addition, this peptide significantly reduced the severity of collagen-induced arthritis in mice by reducing levels of tumor necrosis factor-α and interleukin-1β, abrogating joint swelling and reducing destruction of bone and cartilage. Therefore, selective inhibition of NF-κB activation offers an effective therapeutic approach for inhibiting chronic inflammatory diseases involving bone resorption.