An ideal replacement for bone defects is auto-bone tissue, of which there is an ample supply with the required form and with vascularity. Our strategy for generating such bone tissue is as follows. First, bone tissue is induced in muscle by bone morphogenetic protein-2 (BMP-2) with beta-tricalcium phosphate as a carrier to maintain its form in the muscle. Second, the induced bone in the muscle pedicle is grafted to the bone defect to maintain vascularity. In the first experiment, 50 microg of recombinant human BMP-2 (rhBMP-2) was inoculated into the hip abductor muscle of rabbits with beta-tricalcium phosphate under anesthesia. Five weeks after the operation, intramuscular bone formation was observed in all of the samples, and the form and size of the induced bone tissue were identical to those of the carrier. Ten weeks after the operation, the induced bone was partly absorbed. In the second experiment, 50 microg of rhBMP-2 was inoculated in the same manner as previously. Five weeks after the operation, the muscle tissue around the induced bone was incised, leaving just the proximal part as a pedicle. Two or four weeks after the second operation, the induced bone tissue had rich vascularity and no empty lacunae. This indicates the possibility of in vivo bone banking to enable morphologically controlled and vascularized auto-bone grafts.