This study was designed to examine the osteogenecity of demineralized bone matrix (DBM) prepared from intramembranous (IM) bone and to quantitatively assess the amount of new bone formed by IM autogenous bone grafts with or without DBM(IM). Forty-two defects were created in 42 New Zealand White rabbits. Twenty-one defects were grafted with IM bone alone, and the other 21 defects were grafted with composite IM-DBM(IM). Eleven rabbits, 22 defects were used as controls, where 11 defects were left empty (passive control) and the other 11 defects were filled with rabbit skin collagen (active control). Tissues were retrieved on days 1, 2, 3, 4, 5, 6, 7, and 14 for qualitative and quantitative analysis. Cells involved in the healing of composite IM and IM-DBM(IM) bone grafts were identified. No cartilage cells were detected during the healing of either grafts. Appearance of small blood vessels into the newly formed matrix was seen on day 5 in IM bone grafts and on day 4 in composite IM-DBM(IM) bone graft. Quantitative analysis was performed by means of image analysis on 100 sections of tissues retrieved after 14 days. Approximately 204% more new bone was formed in defects grafted with composite IM-DBM(IM) than in those grafted with IM bone alone (P <.0001). No bone was formed across the defects in either active or passive controls. In conclusion, DBM(IM) significantly increases the osteogenicity of IM bone grafts.