Demineralized homogenous bone matrix is reported to have no antigenic activity and its osteoinductive prcoess is faster than that of undemineralized homogenous bone. The present authors studied on the osteoinduction of demineralized human osteosarcoma in rat's muscle pouch. The results showed that demineralized human osteosarcoma tissue can induce new bone though there were inflammatory signs and giant. cell reaction. The osteoinductive process seemed to be delayed compared to that of demineralized homogenous bone matrix. The authors believed that further immunological investigations are needed to clarify the cause of these tissue response.