Collagen/bone morphogenetic protein composites were prepared with collagen type I sponge and bone morphogenetic protein-2 (BMP-2). The composites were implanted into Latissimus dorsi muscles pouches of rabbits. Samples were studied with ALP staining, Von Kossa staining, HE staining, toluidine blue staining and CD31 histochemical labeling of microvessel. Bony samples were then used to repair mandibular defect. The effects were evaluated by X-ray, compressive strength, economycin fluorescence labeling, HE staining, toluidine blue staining and bone quantity analysis. Bone formation induced by collagen/BMP composites was found as woven bone between 4 and 6 weeks; cartilaginous osteogenesis was the main type of bone formation; microvessels could be seen in the bony tissues; and the bone defects were healed completely 6 weeks after operation. Bone formation induced by collagen/BMP composites in the muscles can be used as a donor to repair the bone defect.