Background Acquired cholesteatoma is characterized by hyper-keratinized squamous epithelium and bone destruction. However, direct evidence for hyper-keratinized epidermis promoting bone destruction is lacking. Aims/Objectives To determine whether higher degree of keratinization correlated with severe bone destruction and further offer direct evidence for keratinocyte-inducing osteoclastogenesis. Materials and Methods Histological changes and clinical relevance were analyzed in human-acquired cholesteatoma. Animal models were established by implanting autologous epidermis with different degrees of keratinization. The severity of bone resorption and the number of osteoclasts were compared in different keratinized groups. An in vitro coculture system was developed to mimic the progress of keratinocyte-inducing osteoclastogenesis. Results The matrix of cholesteatoma was composed of a thicker stratum corneum than normal skin. The stratum corneum thickness and the expression of Keratin 10 positively correlated to the severity of bone destruction. Animal models revealed that the bone destruction induced by a higher keratinized epidermis was more severe. Osteoclasts were detected in bone erosion areas, and the number of osteoclasts increased with the keratinization degrees of the graft. In vitro studies showed that keratinocytes directly promoted monocytes differentiating into osteoclasts. Conclusions and significance In acquired cholesteatoma, the degree of keratinization correlated with disease severity, and keratinocytes directly promote osteoclastogenesis.