This study investigated the delivery of bone morphogenetic protein (BMP)4-secreting muscle-derived stem cells (MDSC-B4) capable of inducing bone formation in mice using collagen gel (CG), fibrin sealant (FS), and gelatin sponge carriers. After implanting these various cell-loaded scaffolds intramuscularly or into critical-size skull defects, we measured the extent of heterotopic ossification and calvarial defect healing over a 6-week period via radiographic, radiomorphometric, histological, and micro-computed tomography analyses. As expected, in the absence of MDSC-B4, there was no ectopic ossification and only minimal calvarial regeneration using each type of scaffold. Although CG and gelatin sponges loaded with BMP4-secreting cells produced the most ectopic bone, FS constructs produced bone with comparably less mineralization. In the mouse calvaria, we observed MDSC-B4-loaded scaffolds able to promote bone defect healing to a variable degree, but there were differences between these implants in the volume, shape, and morphology of regenerated bone. MDSC-B4 delivery in a gelatin sponge produced hypertrophic bone, whereas delivery in a CG and FS healed the defect with bone that closely resembled the quantity and configuration of native calvarium. In summary, hydrogels are suitable carriers for osteocompetent MDSCs in promoting bone regeneration, especially at craniofacial injury sites.