We reported a technique for articular cartilage repair, consisting of microfracture, a biomaterial scaffold of perforated decalcified cortical bone matrix (DCBM) and adenovirus-bone morphogenetic protein-4 (Ad-BMP4) gene therapy. In the present study, we evaluated its effects on the quality and quantity for induction of articular cartilage regeneration. Full-thickness defects were created in the articular cartilage of the trochlear groove of rabbits. Four groups were assigned: Ad-BMP4/perforated DCBM composite (group I); perforated DCBM alone without Ad-BMP4 (group II); DCBM without perforated (group III) and microfracture alone (group IV). Animals were sacrificed 6, 12 and 24 weeks postoperation. The harvested tissues were analyzed by magnetic resonance image, scanning electron microscope, histological examination and immunohistochemistry. Group I showed vigorous and rapid repair leading to regeneration of hyaline articular cartilage at 6 weeks and to complete repair of articular cartilage and subchondral bone at 12 weeks. Groups II and III completely repaired the defect with hyaline cartilage at 24 weeks, but group II was more rapid than group III in the regeneration of repair tissue. In group IV the defects were concave and filled with fibrous tissue at 24 weeks. These findings demonstrated that this composite biotechnology can rapidly repair large areas of cartilage defect with regeneration of native hyaline articular cartilage.