Nitric oxide has many functions in wound healing and metabolism of bone. In the current study the role of nitric oxide on bone healing was investigated. Thirty-six young adult male Sprague-Dawley rats were divided into three groups: control, nitroso-bovine serum albumin, and aminoguanidine. Five millimeter segmental defects were created in the middle of the right femora. A polyethylene plate and screw posts were used for rigid fixation. Demineralized bone matrix served as the graft material in all groups. Nitroso-bovine serum albumin (an active nitric oxide congener) carried by demineralized bone matrix was applied locally at the defect in the nitroso-bovine serum albumin group. Aminoguanidine (an inducible nitric oxide synthase inhibitor) group received oral aminoguanidine treatment. Formation and healing of bone were determined by radiographic and histologic analyses. In comparison to the control group the healing rate was faster in both experimental groups as indicated by radiographic and histologic data. If accompanied by bone graft with a suitable delivery system, nitric oxide may be useful as a therapeutic adjuvant in clinical situations when local formation of bone is needed. Moreover, when combined appropriately, treatment with orthotopic nitric oxide supplementation and systemic inducible nitric oxide synthase inhibition may enhance bone healing.