This study addresses the fabrication of an extracellular matrix material of the acellular sheep periosteum and the systematic evaluation of its biocompatibility to explore its potential application in guided bone regeneration. Sheep periosteum was harvested and decellularized by a combined decellularization protocol. The effectiveness of cell removal was proved and residual α-Gal antigen was also quantitatively detected. Then, mouse MC3T3-E1 cells were seeded onto the acellular periosteum. A scanning electron microscope (SEM) was used to record the whole process of cell adhesion. The CCK-8 assay suggested that the acellular periosteum not only had zero toxic effect on pre-osteoblasts, but played a positive role in cell proliferation. We also tested whether the acellular periosteum possesses favorable osteogenesis induction activity using an alkaline phosphatase (ALP) assay and a quantitative real-time PCR (Col I, Runx2, OCN) assay. An in vivo study of a subcutaneous implantation test using Sprague Dawley (SD) rats was performed to detect the changes in IL-2, IFN-γ and IL-4 in serum and elucidate the host's local response to acellular periosteum through hematoxylin and eosin (HE) and immunohistochemical staining. The results show that acellular sheep periosteum did not elicit a severe immunogenic response via the Th1 pathway, unlike fresh sheep periosteum. In conclusion, acellular sheep periosteum possesses favorable biocompatibility to be employed for guided bone regeneration.