Glucocorticoids are widely used for their unsurpassed anti-inflammatory and immunomodulatory effects. However, the therapeutic use of glucocorticoids is almost always limited by substantial adverse outcomes such as osteoporosis, diabetes, and obesity. These unwanted outcomes are a major dilemma for clinicians because improvements in the primary disorder seem to be achievable only by accepting substantial adverse effects that are often difficult to prevent or treat. To understand the pathogenesis of glucocorticoid-induced osteoporosis, it is necessary to consider that the actions of glucocorticoids on bone and mineral metabolism are strongly dose and time dependent. At physiological concentrations, endogenous glucocorticoids are key regulators of mesenchymal cell differentiation and bone development, with additional regulatory roles in renal and intestinal calcium handling. However, at supraphysiological concentrations, glucocorticoids affect the same systems in different and often unfavourable ways. For many years, these anabolic and catabolic actions of glucocorticoids on bone were deemed paradoxical. In this Review, we highlight recent advances in our understanding of the mechanisms underlying the physiology and pathophysiology of glucocorticoid action on the skeleton and discuss present and future management strategies for glucocorticoid-induced osteoporosis.