Camurati-Engelmann disease (CED) is a rare autosomal dominant disorder characterized by bone pain and osteosclerosis affecting the diaphysis of long bones. CED is caused by various missense mutations in the TGFB1 gene that encodes TGFβ1, the most common of which is an arginine-cysteine amino acid change at codon 218 (R218C) in the latency-associated peptide domain of TGFβ1. We studied osteoclast formation in vitro from peripheral blood mononuclear cells obtained from three related CED patients harboring the R218C mutation, in comparison with one family-based and several unrelated controls. Osteoclast formation was enhanced approximately 5-fold (P < 0.001) and bone resorption approximately 10-fold (P < 0.001) in CED patients, and the increase in osteoclast formation was inhibited by soluble TGFβ type II receptor. Total serum TGFβ1 levels were similar in affected and unaffected subjects, but concentrations of active TGFβ1 in conditioned medium of osteoclast cultures was higher in the three CED patients than in the unaffected family member. We concluded that the R218C mutation increases TGFβ1 bioactivity and enhances osteoclast formation in vitro. The activation of osteoclast activity noted here is consistent with clinical reports that have shown biochemical evidence of increased bone resorption as well as bone formation in CED.