Concerns over disease transmission, high costs and limited supply have led to interest in synthetic grafts in the field of impaction bone grafting (IBG). Poly(DL-lactic acid) (PLA) grafts are attractive alternatives due to their biocompatibility, established safety and versatile manufacturing process. This study examined the potential of PLA scaffolds augmented with human bone marrow stromal cells (HBMSCs) in IBG. In vitro and in vivo studies were performed on impacted morsellised PLA seeded with HBMSC and compared to PLA alone. In vitro samples were incubated under osteogenic conditions and in vivo samples were implanted subcutaneously into severely compromised immunodeficient mice, for 4 weeks. Biochemical, histological, mechanical and 3D micro-computed tomography analyses were performed. HBMSC viability, biochemical activity and histological evidence of osteogenic cellular differentiation, post-impaction were observed in vitro and in vivo in PLA/HBMSC samples compared to impacted PLA alone. In vitro PLA/HBMSC samples demonstrated evidence of mechanical enhancement over PLA alone. In vivo studies showed a significant increase in new bone and blood vessel formation in the PLA/HBMSC constructs compared to PLA alone. With alternatives to allograft being sought, these studies have demonstrated PLA/HBMSC living composites, to be a potential prospect as a biological bone graft extender for future use in the field of IBG.