Receptor activator of nuclear factor kappa B ligand (RANKL), a potent regulator of osteoclast formation and function, is expressed by osteoblasts and bone marrow stromal cells. However, the molecular mechanism underlying RANKL expression in osteoblast/stromal cells remains largely unclear. Here, we characterized the molecular mechanism controlling RANKL basal transcription in osteoblast/stromal cells. We cloned a 1,103-bp murine RANKL promoter (from -953 to +150, relative to the transcription start site). Using a series of deletion mutants of the 1,103-bp promoter, we identified a 100-bp region (-154 to -54) mediating RANKL basal transcription in both osteoblasts and bone marrow stromal cells. Electrophoretic mobility shift assay (EMSA) using five overlapping oligonucleotides (Probes 1-5) spanning the 100-bp region showed that Probes 1 and 2 specifically bound nuclear proteins with high affinity from both cell types. Computer analysis revealed that Probes 1 and 2 contain a putative Sp1-binding site. Supershift assays with Sp1 and Sp3 antibodies confirmed that the nuclear proteins binding to Probes 1 and 2 are Sp1 and Sp3. Functionally, the mutation of the Sp1/Sp3 site in Probe 1 profoundly reduced the basal promoter activity while the mutation of the one in Probe 2 resulted in moderate reduction in the basal promoter activity. Moreover, the mutation of both sites abrogated the RANKL basal promoter activity, indicating that Sp1 and Sp3 play a key role in the RANKL basal transcription in osteoblasts and bone marrow stromal cells.