The immune system plays an important role in the pathophysiology of many acute and chronic bone disorders, but the specific inflammatory networks that regulate individual bone disorders remain to be elucidated. Here, we characterized the osteoimmunological underpinnings of osteolytic bone disease in Pstpip2^cmo mice. These mice carry a homozygous L98P missense mutation in the Pombe Cdc15 homology family phosphatase PSTPIP2 that is responsible for the development of a persistent autoinflammatory disease resembling chronic recurrent multifocal osteomyelitis in humans. We found that improper regulation of IL-1β production resulted in secondary induction of inflammatory cytokines, inflammatory cell infiltration in the bone, and unremitting bone inflammation. Aberrant Il1β expression precedes the development of osteolytic damage in young Pstpip2^cmo mice, and genetic deletion of Il1r and Il1β, but not Il1α, rescued osteolytic bone disease in mutant mice. Intriguingly, caspase-1 and nucleotide-binding oligomerization domain (NOD)-like receptor family, pyrin domain containing 3 activation in the inflammasome complex were dispensable for Pstpip2^cmo-mediated bone disease. Thus, our findings establish a critical role for inflammasome-independent production of IL-1β in osteolytic bone disease and identify PSTPIP2 as a negative regulator of caspase-1–autonomous IL-1β production.