Osteoclasts (OCs) are bone‐resorbing cells formed by the serial fusion of monocytes. In mice and humans, three distinct subsets of monocytes exist;​ however, it is unclear if all of them exhibit osteoclastogenic potential. Here we show that in wild‐type (WT) mice, Ly6C^hi and Ly6C^int monocytes are the primary source of OC formation when compared to Ly6C⁻ monocytes. Their osteoclastogenic potential is dictated by increased expression of signaling receptors and activation of preestablished transcripts, as well as de novo gain in enhancer activity and promoter changes. In the absence of interferon regulatory factor 8 (IRF8), a transcription factor important for myelopoiesis and osteoclastogenesis, all three monocyte subsets are programmed to display higher osteoclastogenic potential. Enhanced NFATc1 nuclear translocation and amplified transcriptomic and epigenetic changes initiated at early developmental stages direct the increased osteoclastogenesis in Irf8‐deficient mice. Collectively, our study provides novel insights into the transcription factors and active cis‐regulatory elements that regulate OC differentiation.