Mesenchymal stem cells (MSC) have shown promise in tissue engineering applications due to their potential for differentiating into mesenchymal tissues such as osteocytes, chondrocytes, and adipocytes and releasing proteins to promote tissue regeneration. One application involves seeding MSCs in biomaterial scaffolds to promote osteogenesis in the repair of bone defects following implantation. However, predicting in vivo survival and differentiation of MSCs in biomaterials is challenging. Rapid and stable vascularization of scaffolds is required to supply nutrients and oxygen that MSCs need to survive as well as to go through osteogenic differentiation. The objective of this study is to develop an agent-based model and simulator that can be used to investigate the effects of using gradient growth factors on survival and differentiation of MSCs seeded in scaffolds. An agent-based model is developed to simulate the MSC behavior. The effect of vascular endothelial growth factor (VEGF) and bone morphogenic protein-2 (BMP-2) on both survival and osteogenic differentiation is studied. Results showed that the survival ratio of MSCs can be enhanced by increasing VEGF concentration. BMP-2 caused a slight increase on survival ratio. Osteogenesis strongly depends on the VEGF concentration as well because of its effect on vascularization. BMP-2 increased the osteogenic differentiation of MSCs.