Receptor activator of nuclear factor-kappaB (NF-kappaB) (RANK) plays a key role in the differentiation, activation, and survival of osteoclasts. Upon activation of RANK with RANK ligand (RANKL), osteoclast precursor cells differentiate into tartrate-resistant acid phosphatase (TRAP)-positive, multinucleated osteoclasts. To identify compounds that block osteoclastogenesis, a cell-based assay was developed using RAW264.7 cells stably transfected with a TRAP promoter-dependent reporter gene as a surrogate readout for differentiation. Described herein is the strategy for high throughput screening and subsequent secondary biological assays for hit triage, which resulted in the identification of compound 1, a 4-nitroimidazole derivative, that specifically inhibited RANKL-induced TRAP gene and protein expression. Compound 1 did not affect the tumor necrosis factor-alpha- or lipopolysaccharide-induced TRAP-luciferase response, suggesting selective inhibition of the RANKL-induced pathway. Reverse transcription polymerase chain reaction analysis confirmed the inhibition of expression of osteoclast marker genes, such as TRAP, cathepsin K, and carbonic anhydrase type II. Compound 1 did not inhibit the RANKL-induced activation of a NF-kappaB reporter gene, or p38 kinase activity, suggesting a mechanism of action downstream of NF-kappaB. Together, these results suggest that we have identified a RANK pathway-specific inhibitor able to block the RANKL-induced osteoclast differentiation process. The hit identification strategy described here can be applied to other cell-based assays using an indirect surrogate readout to improve success rates.