A balance between bone formation and bone resorption is critical for the maintenance of bone mass. In many pathological conditions, including chronic inflammation, uncontrolled activation of osteoclast differentiation often causes excessive bone resorption that results in osteoporosis. In this study, we identified the osteopenia phenotype of mice lacking Usp18 (also called Ubp43), which is a deISGylating enzyme and is known as a negative regulator of type I IFN signaling. The expression of Usp18 was induced in preosteoclasts upon receptor activator of NF-κB ligand (RANKL) treatment. In an in vitro osteoclast-differentiation assay, bone marrow macrophages from Usp18-deficient mice exhibited an enhanced differentiation to multinucleated cells, elevated activation of NFATc1, and an increased expression of osteoclast marker genes upon RANKL treatment. Furthermore, in vitro quantification of bone resorption revealed a great increase in osteoclastic activities in Usp18-deficient cells. Interestingly, proinflammatory cytokine genes, such as IP-10 (CXCL10), were highly expressed in Usp18-deficient bone marrow macrophages upon RANKL treatment compared with wild-type cells. In addition, serum cytokine levels, especially IP-10, were significantly high in Usp18-knockout mice. In sum, we suggest that, although type I IFN is known to restrict osteoclast differentiation, the exaggerated activation of the type I IFN response in Usp18-knockout mice causes an osteopenia phenotype in mice.