Posterolateral spinal fusion is used to treat patients with degenerative spinal disorders. We investigated the effectiveness of a mesenchymal stem cell (MSC)/Pluronic F127/Interpore hybrid graft for spinal fusion in rabbits. Spinal fusion was examined using radiography, manual palpation, computed tomography (CT), torsional loading tests, and histological analysis. Using a PKH fluorescence labeling system, we also examined whether the newly formed bone was derived from the transplanted MSCs. We found that the MSCs adhered to the Interpore surface and within its pores, and differentiated into osteoblasts. Radiographs and CT images showed a continuous bone bridge and a satisfactory fusion mass incorporated into the transverse processes. The results of manual palpation and biomechanical data did not differ significantly from an autograft group. Histology from both groups revealed the presence of fibrous tissue, cartilage, and endochondral ossification in the gaps between the grafted fragments. In both groups, the degree of mature bone formation was greater at 12 weeks than at 6 weeks after grafting. Quantitative histomorphometry revealed no significant differences between the two groups at either time point. In situ tracing of the PKH 67-labeled MSCs indicated that the transplanted MSCs were partly responsible for the new bone formation in both the repaired transverse processes and the grafted fragments. Thus, the MSC/Pluronic F127/Interpore hybrid graft could be used effectively to achieve posterolateral spinal fusion.