We have developed a mathematical model that allows simulation of oxygen distribution in a bone defect as a tool to explore the likely effects of local changes in cell concentration, defect size or geometry, local oxygen delivery with oxygen-generating biomaterials (OGBs), and changes in the rate of oxygen consumption by cells within a defect. Experimental data for the oxygen release rate from an OGB and the oxygen consumption rate of a transplanted cell population are incorporated into the model. With these data, model simulations allow prediction of spatiotemporal oxygen concentration within a given defect and the sensitivity of oxygen tension to changes in critical variables. This information may help to minimize the number of experiments in animal models that determine the optimal combinations of cells, scaffolds, and OGBs in the design of current and future bone regeneration strategies. Bone marrow-derived nucleated cell data suggest that oxygen consumption is dependent on oxygen concentration. OGB oxygen release is shown to be a time-dependent function that must be measured for accurate simulation. Simulations quantify the dependency of oxygen gradients in an avascular defect on cell concentration, cell oxygen consumption rate, OGB oxygen generation rate, and OGB geometry.