We aimed to develop an in vitro model for bone implant loosening, allowing analysis of biophysical and biological parameters contributing to mechanical instability-induced osteoclast differentiation and peri-implant bone loss. MLO-Y4-osteocytes were mechanically stimulated for 1 h by fluid shear stress using regimes simulating: (i) supraphysiological loading in the peri-prosthetic interface (2.9 ± 2.9 Pa, 1 Hz, square wave); (ii) physiologic loading in the cortical bone (0.7 ± 0.7 Pa, 5 Hz, sinusoidal wave); and (iii) stress shielding. Cellular morphological parameters, membrane-bound RANKL expression, gene expression influencing osteoclast differentiation, nitric oxide release and caspase 3/7-activity were determined. Either Mouse bone marrow cells were cultured on top of loaded osteocytes or osteocyte-conditioned medium was added to bone marrow cells. Osteoclast differentiation was assessed after 6 days. We found that osteocytes subjected to supraphysiological loading showed similar morphology and caspase 3/7-activity compared to simulated physiological loading or stress shielding. Supraphysiological stimulation of osteocytes enhanced osteoclast differentiation by 1.9-fold compared to physiological loading when cell-to-cell contact was permitted. In addition, it enhanced the number of osteoclasts using conditioned medium by 1.7-fold, membrane-bound RANKL by 3.3-fold, and nitric oxide production by 3.2-fold. The stimulatory effect of supraphysiological loading on membrane-bound RANKL and nitric oxide production was higher than that achieved by stress shielding. In conclusion, the in vitro model developed recapitulated the catabolic biological situation in the peri-prosthetic interface during instability that is associated with osteoclast differentiation and enhanced RANKL expression. The model thus provides a platform for pre-clinical testing of pharmacological interventions with potential to stop instability-induced bone implant loosening. © 2017 Orthopaedic Research Society. Published by Wiley Periodicals, Inc. J Orthop Res 36:1425–1434, 2018.