Though somehow not quite mainstream yet after 16 years, Jeff Smith's Bone is a comic book classic known and loved the world over. Much has been written about what Bone is, in terms of literary inspirations. In a biological sense, though, Bone remains a mystery. I am not a biologist, which would probably not help me much with the following speculation anyway.
The Bone characters -- Fone Bone, Phoney Bone, and Smiley Bone are descendents of classic cartoon characters, anatomically simplified to the point where one can mentally fill in the blanks and imagine any features -- if not our own. Reminiscent of Who Framed Roger Rabbit, the cartoony Bones inhabit the same world with more realistically drawn human characters. In this way, instead of their abstractness being a stylistic choice, it shows that the Bones are entirely different beings. But what manner of beings? They most closely resemble mammals. They have hair (not much hair, but they do have eyebrows) and sweat (profusely while in the desert), but clearly lack nipples and outside genitalia (evident because the Bones spend all of their time nude or almost nude). Their smooth, featureless bodies are more like reptiles or amphibians.
If judged solely by Fone and Phoney Bone, Bones in general would seem to show little variation, and yet Smiley Bone is remarkably different in height (about four feet tall, while he's cousins are about two and a half feet tall) and body shape. Unlike the traditional "squash and stretch" characteristic of animated cartoon characters, Bones seem to hold the same body shapes with only limited ability to contort them. When Fone Bone falls off a cliff and bounces off some rocks, he retains his shape throughout the ordeal. However, Fone is also capable of intentionally altering his shape, such as when he increases the size of his arm muscles to show off at the fair, or can have his shape altered by another Bone, such as when Phoney stretches Fone's face out to the shape of a pie by shoving the pie into his mouth. Only in the face are Bones highly malleable, being able to alter the size of their eyes and open their mouths so large that they appear to not be hinged (the latter being, again, reptillian in appearance).
It is tempting to suggest that having cartiledge instead of bone could produce this malleability, yet Fone Bone endures plenty of damage alongside Thorn when they are tortured in prison and seems to be no worse for wear than she is (cartilledge would break more easily than bone). Another possibility is that Bones are, internally, highly malleable, but their outer bodies are akin to rubbery exoskeletons. This would be an extremely unique lifeform, neither mammal nor reptile. The inside body seems to function similarly to most animals, with a circulatory system that uses blood (or at least a blood-like fluid, as Fone "bleeds" semi-regularly) and a sex drive that feels arousal from outside stimulus (like Fone feels when he sees Thorn); or like humans specifically, with lungs and a diaphram able to produce speech and a digestive system able to eat the same foods as humans (though more, since Phoney can eat sticks and Fone can eat roofing tar).
Speaking of sex drives, how would Bones reproduce? The lack of genitalia suggests asexual reproduction, and yet Fone Bone's interest in Thorn suggests otherwise. We also have seen how the exoskeleton can be consciously made malleable, or made malleable by contact with another Bone. The final fact that the Bone cousins' ancestor is "Big" Johnson Bone seems to be the final proof that Bones can "sprout" genitalia when the need arises.