Liposomes containing phosphatidylserine (PS) are engulfed by phagocytes including macrophages, microglia, and dendritic cells. PS liposomes (PSLs) mimic the effects of apoptotic cells on these phagocytes to induce the secretion of anti-inflammatory molecules and to inhibit the maturation of dendritic cells. However, the effects of PSLs on osteoclasts, which are also differentiated from the common myeloid precursors, remain to be determined. This study investigated the effects of PSLs on the osteoclastogenesis. In the rat bone marrow culture system, osteoclast precursors phagocytosed PSLs to secrete TGF-beta1 and PGE(2), which in turn inhibited osteoclastogenesis through the downregulation of receptor activator for NF-kappaB ligand, receptor activator of NF-kappaB, ICAM-1, and CD44. Consistent with these in vitro observations, i.m. injection of PSLs significantly increased the plasma level of TGF-beta1 and PGE(2) and decreased the expression of receptor activator for NF-kappaB ligand, receptor activator of NF-kappaB, and ICAM-1 in the skeletal tissues of ankle joints of rats with adjuvant arthritis (AA). A quantitative analysis using microcomputed tomography revealed that PSLs as well as TGF-beta1 together with PGE(2) significantly inhibited AA-induced trabecular bone loss. These observations strongly suggest that PSLs generate TGF-beta1 and PGE(2) release, leading to inhibit osteoclastogenesis and AA-induced trabecular bone loss. Because PS is a component of the cell membrane, PSLs therefore can be a potentially effective pharmacological intervention against abnormal bone loss, such as osteoporosis without deleterious side effects.