Diphenylhydantoin (DPH) is widely used as an anticonvulsant drug. We examined the effects of DPH on osteoclast differentiation and function using in vivo and in vitro assay systems. Transgenic mice overexpressing a soluble form of RANKL (RANKL Tg) exhibited increased osteoclastic bone resorption. Injection of DPH into the subcutaneous tissue overlying calvaria of RANKL Tg mice suppressed the enhanced resorption in the calvaria. In co-cultures of mouse osteoblasts and bone marrow cells, DPH inhibited lipopolysaccharide (LPS)-induced osteoclast formation. DPH affected neither the mRNA expression of RANKL and osteoprotegerin nor the growth of mouse osteoblasts in culture. On the other hand, DPH inhibited the RANKL-induced formation of osteoclasts in cultures of mouse bone marrow–derived macrophages (BMMϕs) and of human peripheral blood-derived CD14+ cells. DPH concealed LPS-induced bone resorption in mouse calvarial organ cultures and inhibited the pit-forming activity of mouse osteoclasts cultured on dentine slices. DPH suppressed the RANKL-induced calcium oscillation and expression of nuclear factor of activated T cells c1 (NFATc1) and c-fos in BMMϕs. Moreover, DPH inhibited the RANKL-induced nuclear localization and auto-amplification of NFATc1 in mature osteoclasts. Both BMMϕs and osteoclasts expressed mRNA of a T-type calcium channel, Cav3.2, a target of DPH. Blocking the expression of Cav3.2 by short hairpin RNAs significantly suppressed RANKL-induced osteoclast differentiation. These results suggest that DPH inhibits osteoclast differentiation and function through suppression of NFATc1 signaling. The topical application of DPH may be a therapeutic treatment to prevent bone loss induced by local inflammation such as periodontitis.