The relative osteogenic potentialof two different preparations of lyophilized human demineralized bone were evaluated using a heterotopic site in a rodent model. Human diaphyseal cortical bone (75‐850 μm) was demineralized according to two different protocols for decalcified bone allograft (A. H. Reddi and M. R. Urist). Equal volumes of mineralized lyophilized human bone and a proprietary hydroxylapatite served as controls. Thirty‐two Long‐Evans rats divided into four groups received subcutaneous implants of one of these four preparations. Implants were harvested at two, four, and six weeks. Histometric analysis of limited serial sections at six weeks demonstrated new bone formation by the two demineralized preparations only. The Reddi protocol produced significantly more bone formation (1.13 ± 1.21%) than the Urist preparation (0.53 ± 0.31%). Although bone induction by both the Reddi and Urist protocol was sparse within this xenogeneic system, the Reddi preparation may offer some slight advantage of greater osteogenic potential and ease of preparation. The low yields of induced bone in response to implants of human demineralized bone would limit the use of this model system in assessing osteogenic potential prior to clinical use.