The aim of this study was to investigate the physicochemical and biological properties of a newly developed calcium phosphate cement (CaP cement) implanted in cortical bone. CaP cement was injected as a paste into tibia cortical bone defects in goats. Polymethylmethacrylate (PMMA) bone cement was used as a control. The animals were killed after 3 days, 2, 8, 16 and 24 weeks. X-ray diffraction and Fourier transform infrared spectroscopy performed at retrieved samples showed that the CaP cement had set as a carbonate apatite and remained stable over time. Light microscopic evaluation showed that after 2 weeks the cement was in tight contact with the bone without any inflammatory reaction or fibrous encapsulation. At later time points, the CaP cement implants were totally covered by a thin layer of bone and osteoclasts, present at the interface, which were clearly resorbing the cement. At locations where CaP cement was resorbed, new bone was deposited. Transmission electron microscopy revealed that indeed a seamless contact existed between CaP cement and bone, as characterized by the occurrence of an electron dense line of 50-60 nm thick that covered the CaP cement. Osteoblasts, in contact with the cement, were depositing new bone. Although the bulk of the material was still in situ after 24 weeks, the progressive osteoclast resorption of the cement followed by new bone formation suggests that all of the material may be replaced eventually. In contrast to the CaP cement, the PMMA reference cement was always surrounded by a thin fibrous capsule. The results indicate that the investigated CaP cement is biocompatible, osteoconductive as well as osteotransductive and is a candidate material for use as a bone substitute.