Introduction: Ostene® is a water-soluble wax-like alkylene oxide copolymer preparation for use as a mechanical hemostatic agent. This study aims to evaluate the effects of Ostene® on bone healing. Materials and Methods: Twenty albino rabbits were divided into four groups according to post-treatment follow-up (24 hr, 3 days, 7 days, 14 days) with five rabbits in each group. Each rabbit in all groups was treated with two study materials (Ostene® and Gelfoam®). Three holes were made in the mandibular bone of each rabbit using 5mm surgical bur; two holes were made on right side: one for testing Ostene® and another for Gelfoam®. A third hole, on the left side of mandible, was not treated, and was used as a control. Finally, the incision was closed. The specimens were collected at different days post-treatment and examined by histopathology. Result and Discussion: This study showed that there is a significant difference (p-value≤ 0.05) between the Ostene® group and the other groups (Gelfoam® and control). At 24 hr post intervention, there is a significant difference in osteoblast cell formation (p-value=0.03), and osteoclast cell formation (p-value=0.05). New blood vessel formation, osteoblast and osteoclast cell formation for Ostene® group at 3 days post-intervention were also significantly different (p-values = 0.05, 0.03, 0.04, respectively). At 7 days post-intervention p-values were 0.05 for osteoblast formation and 0.04 for osteoclast formation, respectively. After 14 days of healing p-value for osteoblast cell formation in the Ostene® group was 0.05 and 0.04 for osteoclast cell formation. Conclusions: The bone hemostatic agent Ostene® is an effective at enhancing osteogenesis by initiating proliferation of osteoblast and osteoclast cells.