Paracetamol is the most widely prescribed simple analgesic and antipyretic. It exerts its effects via cyclooxygenase and endocannabinoid pathways, which may affect signalling in bone cells and hence influence bone metabolism. Given the high rates of paracetamol use in the community and the evidence linking its mechanism of action to bone metabolism, we aimed to investigate the association between paracetamol use, fracture, and bone mineral density (BMD) in women participating in the Geelong Osteoporosis Study (GOS). Cases (n = 569) were women aged ≥ 50 years identified from radiological reports as having sustained a fracture between 1994 and 1996. Controls (n = 775) were women without fracture recruited from the same region during this period. BMD was measured at the spine, hip, total body and forearm using dual energy absorptiometry. Medication use, medical history and lifestyle factors were self-reported. There were 69 (12.1%) paracetamol users among the cases and 63 (8.1%) among the controls. Paracetamol use increased the odds for fracture (OR = 1.56, 95%CI 1.09-2.24, p = 0.02). Adjustment for BMD at the spine, total hip and forearm did not confound the association. However, incorporating total body BMD into the model attenuated the association (adjusted OR = 1.46, 95%CI 1.00-2.14, p = 0.051). Further adjustment for age, weight, physical activity, smoking, alcohol, calcium intake, medication use, medical conditions, falls and previous fracture did not explain the association. These data suggest that paracetamol use is a risk factor for fracture, although the mechanism of action remains unclear.