Osteolytic bone diseases are commonly presented with enhanced osteoclast formation and bone resorption. Sesquiterpene lactone natural compounds have been found to possess anti-inflammatory and immune-modulation effects. Here, we identified three germacrane sesquiterpenes using computer-based virtual screening for the structural similarity with sesquiterpene lactone, parthenolide. We showed that natural germacrane sesquiterpene compounds A, B, and C inhibit osteoclast formation and bone resorption in a dose-dependent manner, with relative potency compound A > compound C > compound B based on their equimolar concentrations. Mechanistic studies by Luciferase reporter gene assay and Western blot analysis showed that germacrane sesquiterpene compound A inhibits RANKL-induced activation of NF-B and IB degradation. This study reveals that natural germacrane sesquiterpene compounds are inhibitors for osteoclast formation and bone resorption, and provides evidence that naturally-occurring compounds might be beneficial as alternative medicine for the prevention and treatment of osteolysis.