MCP-1 (monocyte chemotactic protein-1) is a CC chemokine that is induced by receptor activator of NFkappaB ligand (RANKL) in human osteoclasts. In the absence of RANKL, treatment of human peripheral blood mononuclear cells with macrophage colony-stimulating factor and MCP-1 resulted in tartrate-resistant acid phosphatase (TRAP)-positive multinuclear cells that are positive for calcitonin receptor (CTR) and a number of other osteoclast markers, including nuclear factor of activated t cells, cytoplasmic, calcineurin-dependent 1 (NFATc1). Although NFATc1 was strongly induced by MCP-1 and was observed in the nucleus, MCP-1 did not permit the formation of bone-resorbing osteoclasts, although these cells had the typical TRAP(+)/CTR(+) multinuclear phenotype of osteoclasts. Despite a similar appearance to osteoclasts, RANKL treatment was required in order for TRAP(+)/CTR(+) multinuclear cells to develop bone resorption activity. The lack of bone resorption was correlated with a deficiency in expression of certain genes related to bone resorption, such as cathepsin K and MMP9. Furthermore, calcitonin blocked the MCP-1-induced formation of TRAP(+)/CTR(+) multinuclear cells as well as blocking osteoclast bone resorption activity, indicating that calcitonin acts at two stages of osteoclast differentiation. Ablation of NFATc1 in mature osteoclasts did not prevent bone resorption activity, suggesting NFATc1 is involved in cell fusion events and not bone resorption. We propose that the MCP-1-induced TRAP(+)/CTR(+) multinuclear cells represent an arrested stage in osteoclast differentiation, after NFATc1 induction and cellular fusion but prior to the development of bone resorption activity.