Hydroxyapatite-carbon nanotube (HA-CNT) composites have the potential for improved mechanical properties over HA for use in bone graft applications. Finding an appropriate sintering atmosphere for this composite presents a dilemma, as HA requires water in the sintering atmosphere to remain phase pure and well hydroxylated, yet CNTs oxidize at the high temperatures required for sintering. The purpose of this study was to optimize the atmosphere for sintering these composites. While the reaction between carbon and water to form carbon monoxide and hydrogen at high temperatures (known as the 'water-gas reaction') would seem to present a problem for sintering these composites, Le Chatelier's principle suggests this reaction can be suppressed by increasing the concentration of carbon monoxide and hydrogen relative to the concentration of carbon and water, so as to retain the CNTs and keep the HA's structure intact. Eight sintering atmospheres were investigated, including standard atmospheres (such as air and wet Ar), as well as atmospheres based on the water-gas reaction. It was found that sintering in an atmosphere of carbon monoxide and hydrogen, with a small amount of water added, resulted in an optimal combination of phase purity, hydroxylation, CNT retention and density.