The β3 integrin cytoplasmic domain, and specifically S⁷⁵², is critical for integrin localization and osteoclast (OC) function. Because growth factors such as macrophage colony–stimulating factor and hepatocyte growth factor affect integrin activation and function via inside-out signaling, a process requiring the β integrin cytoplasmic tail, we examined the effect of these growth factors on OC precursors. To this end, we retrovirally expressed various β3 integrins with cytoplasmic tail mutations in β3-deficient OC precursors. We find that S⁷⁵² in the β3 cytoplasmic tail is required for growth factor–induced integrin activation, cytoskeletal reorganization, and membrane protrusion, thereby affecting OC adhesion, migration, and bone resorption. The small GTPases Rho and Rac mediate cytoskeletal reorganization, and activation of each is defective in OC precursors lacking a functional β3 subunit. Activation of the upstream mediators c-Src and c-Cbl is also dependent on β3. Interestingly, although the FAK-related kinase Pyk2 interacts with c-Src and c-Cbl, its activation is not disrupted in the absence of functional β3. Instead, its activation is dependent upon intracellular calcium, and on the β2 integrin. Thus, the β3 cytoplasmic domain is responsible for activation of specific intracellular signals leading to cytoskeletal reorganization critical for OC function.