A spontaneous mutation in Bruton's tyrosine kinase (Btk) induces a defect in B-cell development that results in the immunodeficiency diseases X-linked agammaglobulinemia in humans and X-linked immunodeficiency (Xid) in mice. Here we show an unexpected role of Btk in osteoclast formation. When bone marrow cells derived from Xid mice were stimulated with receptor activator of NF-kappaB ligand, an osteoclast differentiation factor, they did not completely differentiate into mature multinucleated osteoclasts. Moreover, we found that the defects appeared to occur at the stage in which mononuclear preosteoclasts fuse to generate multinucleated cells. Supporting this notion, macrophages from Xid mice also failed to form multinucleated foreign body giant cells. The fusion defect of the Xid mutant osteoclasts was caused by decreased expression of nuclear factor of activated T cells c1 (NFATc1), a master regulator of osteoclast differentiation, as well as reduced expression of various osteoclast fusion-related molecules, such as the d2 isoform of vacuolar H(+)-ATPase V0 domain and the dendritic cell-specific transmembrane protein. This deficiency was completely rescued by the introduction of a constitutively active form of NFATc1 into bone marrow-derived macrophages. Our data provide strong evidence that Btk plays a critical role in osteoclast multinucleation by modulating the activity of NFATc1.