Recently, autophagy-related proteins were shown to regulate osteoclast mediated bone resorption, a critical process in autoimmune diseases such as rheumatoid arthritis. However, the role of autophagy-linked FYVE containing protein, WDFY3, in osteoclast biology remains elusive. WDFY3 is a master regulator in selective autophagy for clearing ubiquitinated protein aggregates and has been linked with rheumatoid arthritis. Herein, we used a series of WDFY3 transgenic mice (Wdfy3(lacZ) and Wdfy3(loxP)) to investigate the function of WDFY3 in osteoclast development and function. Our data demonstrate that WDFY3 is highly expressed at the growth plate of neonatal mice and is expressed in osteoclasts in vitro cultures. Osteoclasts derived from WDFY3 conditional knockout mice (Wdfy3(loxP/loxP)-LysM-Cre(+)) demonstrated increased osteoclast differentiation as evidenced by higher number and enlarged size of TRAP(+) multinucleated cells. Western blot analysis also revealed up-regulation of TRAF6 and an increase in RANKL-induced NF-κB signaling in WDFY3-deficient bone marrow-derived macrophages compared to wild type cultures. Consistent with these observations WDFY3-deficient cells also demonstrated an increase in osteoclast-related genes Ctsk, Acp5, Mmp9 and an increase of dentine resorption in in vitro assays. Importantly, in vivo RANKL gene transfer exacerbated bone loss in WDFY3 conditional knockout mice, as evidenced by elevated serum TRAP, CTX-I and micro-CT analysis of distal femurs compared to wild type littermates. Taken together, our data highlight a novel role for WDFY3 in osteoclast development and function, which can be exploited for the treatment of musculoskeletal diseases.