The past decade has observed an explosion of new information regarding the impact of inflammation on bone. In rheumatic diseases, several factors that act as both immune modulators and regulators of bone homeostasis have been shown to mediate an imbalance in bone resorption and bone formation resulting in joint degeneration. In rheumatoid arthritis (RA), focal bone loss is due to excess bone resorption by osteoclasts. Resorption is mediated in part by increased local expression of the cytokine receptor activator of nuclear factor-kappaB ligand (RANKL) compared with expression of its decoy receptor osteoprotegerin (OPG). Bone formation by osteoblasts is also impaired at erosion sites in RA, and inhibitors of the canonical Wingless (Wnt) signaling pathway, including DKK1, have been implicated in the suppression of normal osteoblast function at these sites. Inhibition of DKK1 in an animal model of RA attenuated bone erosion by increasing OPG expression as well as promoting bone formation. In contrast to RA, inflammation in the spondyloarthropathies often results in excess periosteal bone formation, highlighting that the net impact of inflammation on bone is specific to the site at which inflammation occurs, and the cell types, cytokines, and factors present within the local bone microenvironment. This fertile area of research bears watching for the identification of novel targets for the prevention of abnormal bone remodeling in inflammatory diseases.