Osteoclasts (Oc) derive from hematopoietic precursors present in the circulation and bone marrow, and they differentiate into multinucleated bone-resorbing cells in response to the dual essential signals receptor activator of NF-κB ligand (RANKL) and macrophage-colony stimulating factor (M-CSF) primarily provided by bone marrow stromal cells (BMSC) and osteoblasts (Ob). However, little is known about signals that direct Oc precursors from the circulation into bone or control their migration within the marrow. Stromal cell-derived factor-1 (SDF-1 or CXCL12) is a chemokine highly expressed by bone endothelium, BMSC, and immature Ob that is essential for the normal homing, early development, and survival of various hematopoietic progenitor cells. We investigated whether SDF-1 and its unique chemokine receptor CXCR4 were involved in regulating human Oc precursor chemotaxis, development, function, or survival. CXCR4 was highly expressed by freshly isolated human monocyte (MN) populations, in vitro generated Oc and Oc-like cells, and mature Oc isolated from human femoral bones. SDF-1 markedly stimulated the chemotactic recruitment of circulating human MN capable of generating bone-resorptive Oc, leading to a 4-fold increase in Oc formation and greater bone pit resorption after their M-CSF + RANKL induced differentiation compared to spontaneously migrating cells. SDF-1 also directly promoted early (but not later) stages of Oc development via stimulating precursor cell numbers, multinucleated cell fusion, increased cell size, and tartrate-resistant acid phosphatase (TRAP) activity in a similar, but non-additive, fashion to M-CSF + RANKL. While SDF-1 did not cause full development of bone-resorbing Oc or stimulate the resorptive function of mature Oc directly, it also did not interfere with any actions promoted by M-CSF + RANKL. In mature human Oc, SDF-1 proved equally as effective as M-CSF + RANKL for preventing Oc apoptosis induced by cytokine withdrawal. In both cases, Oc survival was accompanied by analogous rises in the mRNA ratios for anti-apoptotic Bcl-x_L and Bfl-1 relative to pro-apoptotic Bax, and by marked protein suppression of the critical pro-apoptotic signal Bim. These findings demonstrate for the first time that SDF-1 chemoattracts circulating human Oc precursors capable of developing into bone-resorptive Oc, and that it can stimulate MN cell fusion and TRAP activity, mimic M-CSF + RANKL in early osteoclastogenic effects, substitute for M-CSF + RANKL in maintaining the survival of mature human Oc, and suppress Oc expression of Bim protein. Thus, high levels of SDF-1 produced by bone endothelium, BMSC, and Ob may selectively target circulating Oc precursors into bone and stimulate their marrow migration into suitable perivascular stromal sites for their early development, RANKL differentiation, and survival. Consequently, SDF-1 may be a key factor linking bone vascular cells, BMSC, Ob, and Oc in the normal homeostatic regulation of bone development and remodeling.