Osteoclasts are multinucleated cells that are responsible for resorption of bone, and increased activity of these cells is associated with several common bone diseases, including postmenopausal osteoporosis. Upon adhesion to bone, osteoclasts become polarized and reorganise their cytoskeleton and membrane to form unique domains including the sealing zone (SZ), which is a dense ring of F-actin-rich podosomes delimiting the ruffled border (RB), where protons and proteases are secreted to demineralise and degrade the bone matrix, respectively. These processes are dependent on the activity of small GTPases. Rho GTPases are well known to control the organization of F-actin and adhesion structures of different cell types, affecting subsequently their migration. In osteoclasts, RhoA, Rac, Cdc42, RhoU and also Arf6 regulate podosome assembly and their organization into the SZ. By contrast, the formation of the RB involves vesicular trafficking pathways that are regulated by the Rab family of GTPases, in particular lysosomal Rab7. Finally, osteoclast survival is dependent on the activity of Ras GTPases. The correct function of almost all these GTPases is absolutely dependent on post-translational prenylation, which enables them to localize to specific target membranes. Bisphosphonate drugs, which are widely used in the treatment of bone diseases such as osteoporosis, act by preventing the prenylation of small GTPases, resulting in the loss of the SZ and RB and therefore inhibition of osteoclast activity, as well as inducing osteoclast apoptosis. In this review we summarize current understanding of the role of specific prenylated small GTPases in osteoclast polarization, function and survival.