The mechanisms by which bone resorbing osteoclasts form and are activated by hormones are poorly understood. We show here that the generation of oxygen-derived free radicals in cultured bone is associated with the formation of new osteoclasts and enhanced bone resorption, identical to the effects seen when bones are treated with hormones such as parathyroid hormone (PTH) and interleukin 1 (IL-1). When free oxygen radicals were generated adjacent to bone surfaces in vivo, osteoclasts were also formed. PTH and IL-1-stimulated bone resorption was inhibited by both natural and recombinant superoxide dismutase, an enzyme that depletes tissues of superoxide anions. We used the marker nitroblue tetrazolium (NBT) to identify the cells that were responsible for free radical production in resorbing bones. NBT staining was detected only in osteoclasts in cultures of resorbing bones. NBT staining in osteoclasts was decreased in bones coincubated with calcitonin, an inhibitor of bone resorption. We also found that isolated avian osteoclasts stained positively for NBT. NBT staining in isolated osteoclasts was increased when the cells were incubated with bone particles, to which they attach. We confirmed the formation of superoxide anion in isolated avian osteoclasts using ferricytochrome c reduction as a method of detection. The reduction of ferricytochrome c in isolated osteoclasts was inhibited by superoxide dismutase. Our results suggest that oxygen-derived free radicals, and particularly the superoxide anion, are intermediaries in the formation and activation of osteoclasts.