The tumor promoter 12-O-tetradecanoylphorbol-13-acetate (TPA) at 10(-9) M stimulated the formation of osteoclast-like multinucleated cells (MNCs) in the presence of 1 alpha,25-dihydroxyvitamin D3 in rat bone marrow cultures. However, at 10(-7) M, it clearly inhibited 1 alpha,25-dihydroxyvitamin D3-dependent osteoclast-like MNC formation at 6 days of culture. In cultures treated with 10(-7) M TPA, numerous MNCs that lack the marker enzyme tartrate-resistant acid phosphatase (TRAP) were formed. These TRAP-negative MNCs had neither receptors for calcitonin nor dentine-resorbing activity. The reactivity of the cells against antirat macrophage antibodies was completely different from that of authentic osteoclasts. These data suggest that TRAP-negative MNCs formed in the presence of 10(-7) M TPA are macrophage polykaryons. Time-course studies showed that 10(-7) M TPA stimulated osteoclast-like MNC formation at 4 days of culture, but these osteoclast-like MNCs were converted to TRAP-negative MNCs. Furthermore, 1-(5-isoquinolinyl-sulfonyl)2-methylpiperazine (H-7), a protein kinase-C inhibitor, inhibited osteoclast-like MNC formation in a dose-dependent fashion. These results suggest that activation of protein kinase-C may play a role in osteoclast differentiation.