Phosphodiesterases (PDEs) are enzymes that degrade intracellular cAMP. In the present study, pentoxifylline, a PDE inhibitor, induced osteoclast formation in co-cultures of mouse bone marrow cells and calvarial osteoblasts. To address the involvement of the osteoclast differentiation factor TNF-related activation-induced cytokine (TRANCE, identical to RANKL, ODF, and OPGL), mouse bone marrow cells and calvarial osteoblasts were co-cultured with pentoxifylline in the presence of OPG, a decoy receptor for TRANCE. The osteoclastogenic effect of pentoxifylline was completely blocked by addition of OPG, suggesting that TRANCE is involved in the osteoclast formation induced by pentoxifylline, Northern blot analysis revealed that pentoxifylline significantly induced TRANCE mRNA expression in calvarial osteoblasts. These results suggests that pentoxifylline regulates TRANCE expression in osteoblasts, which in turn controls osteoclast formation.