Osteoclasts are multinucleated cells formed by fusion of mononuclear precursors in response to receptor activator of nuclear factor κB (NF-κB) ligand (RANKL). We found that RANKL induced expression of the DExD/H helicase family corepressor strawberry notch homologue 2 (Sbno2). Previous in vitro studies showed that Sbno2 is induced by IL-10 and is involved in NF-κB repression. However, the role of Sbno2 in vivo and its pleiotropic functions are unknown. Sbno2 gene targeting resulted in normal NF-κB activation by TLR ligands. However, Sbno2-deficient mice exhibited increased bone mass due to impaired osteoclast fusion. Expression of dendritic cell-specific transmembrane protein (DC-STAMP), a critical player in osteoclast fusion, was significantly attenuated, and cell fusion of Sbno2-deficient osteoclasts was rescued by DC-STAMP. Sbno2 directly bound to T cell acute lymphocytic leukemia 1 (Tal1) and attenuated its inhibition of DC-STAMP expression, leading to activation of the DC-STAMP promoter by microphthalmia-associated transcription factor (MITF). Thus, Sbno2 plays a pivotal role in bone homeostasis in vivo by fine-tuning osteoclast fusion.