Aims: Wood is a product of nature, has a structural architecture resembling bone and is chemically polymer-like. Birchwood modified with heat and humid air was selected to study its possibilities for bone reconstruction. Methods: Bulk birchwood was prepared for 2–3 hours at temperature of 220°C in humid air, this modifies the wood chemically and physically. 16 cone shaped implants 7x4 mm in size were carved from the heat treated material (Bioactive Wood Bone, BWB) and implanted by press-fit technique into holes drilled in the distal femurs of rabbits. Untreated cones served as controls. The resected knees were embedded in plastic (Techmont, Kulzer GmBH). For evaluation histology, histomorfometry and scanning electron microscopy (SEM) were carried out. Results: In vitro SEM showed the canal structures of the wood. In vivo no articular hydrops or wound infections were seen. At 4 and 8 weeks an inflammatory cellular reaction of a mild degree with some histiocytes was observed. At 8 and 20 weeks the implant’s surface was in connection with the surrounding bone and connective tissue. Bone-implant contact at the interface required proper press-fit technique. At 8 and 20 weeks histometry revealed new bone growth covering 21% (mean, range 6–41%) of the implant surface resembling the osteoconductive bonding characteristic of biomaterials. Conclusions: Modified heat treated wood showed biocompatibility and osteoconductivity in cancellous bone defect. A bone bonding-like-phenomenon observed at the interface between the birch implant and bone illustrates it’s potentials for use as a bone substitute.