Rheumatoid arthritis (RA) is an autoimmune inflammatory disease in which destruction of bone in the joints causes major morbidity. Recent research has shed light on the cell and molecular mechanisms that lead to this osteolysis, all due directly or indirectly to the chronic inflammation. The aspects of this research covered in this review include the alteration of cell proliferation and survival that results in growth of the RA synovium. This process depends upon an increase in angiogenesis and local blood flow, which is also a feature of increased bone turnover. In addition, the inflammatory environment increases expression of chemokines, which are involved in the recruitment of monocytic osteoclast precursors. Chronic inflammation also promotes an overall catabolic state, with increased osteoclast differentiation and resorptive activity, driven by disregulation of receptor activator of NF-kappaB ligand (RANKL) and the synergistic activity of inflammatory cytokines such as tumor necrosis factor-alpha and interleukin-1. Osteoclast survival is increased in this environment, but osteoblast differentiation and survival are decreased, with a consequent reduction in bone formation and a net loss of bone. Recognition of these processes and the factors involved will enable more effective and targeted treatments for RA.