Shoulder instability is a pathologic increase in translation of the humeral head on the glenoid fossa during shoulder range of motion, resulting in symptoms. In recurrent anterior shoulder instability, the underlying pathology typically involves compromise of the capsulolabral attachment of the inferior glenohumeral ligament. However, bone loss from either the glenoid rim or posterolateral humeral head can also occur, which can adversely affect traditional treatment. Even in the hands of experts, an unrecognized or neglected bony defect is the primary reason for failure after arthroscopic management of shoulder instability. Anatomic glenoid reconstruction with autogenous tricortical iliac crest bone graft is warranted when there is greater than 30% loss of inferior glenoid length. Latarjet reconstruction (coracoid transfer) is indicated for bone loss that involves 25% to 30% of inferior glenoid length, especially after failed stabilization, or for humeral Hill-Sachs lesions that engage the anterior glenoid rim when the arm is in a position of abduction and external rotation. Arthroscopic repair can be performed for patients with small osseous lesions (less than 20% bone loss).