Osteosarcoma (bone cancer) is an aggressive form of cancer that is always a bad diagnosis. I have had patients with this disease over the years, and it always results in major surgery or euthanasia. The key in these cases is rapid diagnosis and aggressive surgery (if possible). The faster the tumor is removed the better the chance of a decent to good outcome. While amputating a limb is always a scary thought, in these cases it is typically the only chance for survival.
The Morris Animal Foundation has provided a great infographic that I'm sharing here. If your dog shows any signs of a lump that may be associated with bone you should take them to your vet right away.