Osteoporosis is characterized by enhanced differentiation of bone-resorbing osteoclasts resulting in a rapid loss of functional trabecular bone. Bone-forming osteoblasts and osteoblast-derived osteocytes perform a key role in the regulation of osteoclast development by providing both the pro-osteoclastogenic cytokine RANKL and its natural decoy receptor OPG. By regulating the RANKL/OPG ratio, osteoblasts hence determine the rate of both osteoclast differentiation and bone turnover. Here, we describe a novel role for liver X receptors (LXRs) during the crosstalk of bone-forming osteoblasts and bone-resorbing osteoclasts. By using a system of osteoblast/osteoclast co-cultures, we identify LXRs as regulator of RANKL expression and the RANKL/OPG ratio in osteoblasts. Activation of LXRs drastically reduced the RANKL/OPG ratio and interfered with osteoblast-mediated osteoclast differentiation in vitro. During an ovariectomy (OVX)-induced model of postmenopausal osteoporosis, the application of an LXR agonist shifted the RANKL/OPG ratio in vivo, ameliorated the enhanced osteoclast differentiation and provided complete protection from OVX-induced bone loss. These results reveal an unexpected involvement of LXRs in the regulation of bone turnover and highlight a potential role for LXRs as novel targets in the treatment of osteoporosis and related diseases. © 2012 American Society for Bone and Mineral Research.