The matrix metalloproteinases MMP-2, MMP-3, MMP-7, MMP-9, and MMP-13 are highly expressed in the tumor-bone microenvironment, and, of these, MMP-7 and MMP-9 were found to be localized to bone-resorbing osteoclasts in human breast-to-bone metastases. In a bid to define the roles of host-derived MMP-7 and MMP-9 in the tumor-bone microenvironment, the tibias of MMP-7 and MMP-9 null mice were injected with osteolytic luciferase-tagged mammary tumor cell lines. Our data show that osteoclast-derived MMP-7 significantly contributes to tumor growth and tumor-induced osteolysis whereas osteoclast-derived MMP-9 had no effect on these processes. MMP-7 is capable of processing a number of nonmatrix molecules to soluble active forms that have profound effects on cell-cell communication, such as RANKL, a crucial mediator of osteoclast precursor recruitment and maturation. Therefore, the ability of osteoclast-derived MMP-7 to promote RANKL solubilization in the tumor-bone microenvironment was explored. Results revealed that levels of soluble RANKL were significantly lower in the MMP-7 null mice compared with wild-type (WT) controls. In keeping with this observation, MMP-7 null mice had significantly fewer osteoclast numbers at the tumor-bone interface compared with the WT controls. In summary, we propose that the solubilization of RANKL by MMP-7 is a potential mechanism through which MMP-7 mediates mammary tumor-induced osteolysis. Our studies indicate that the selective inhibition of MMP-7 in the tumor-bone microenvironment may be of benefit for the treatment of lytic breast-to-bone metastases.