Purpose: The aim of the present study was to test whether a newly developed synthetic matrix made of polyethylene-glycol (PEG) containing a covalently bound peptide of the parathyroid hormone (PTH1-34) enhances bone regeneration compared to grafting procedures and to spontaneous healing. Materials and Methods: In each of 16 rabbits used, 4 titanium cylinders were screwed into perforated slits made in the cortical bone of the calvaria. The cylinders were either left empty (control) or filled with 1 of the following: (1) PEG matrix and hydroxyapatite/tricalcium phosphate (HA/TCP) granules, (2) PEG matrix containing 100µg/mL of PTH1-34 and HA/TCP granules, or (3) PEG matrix containing 20µg/mL of PTH1-34 and HA/TCP granules. After 8 weeks, the animals were sacrificed, and ground sections were obtained for histology. Results: Quantitative histomorphometry demonstrated a significantly increased amount of newly formed bone for PTH1-34 compared to sites treated with PEG and HA/TCP and to empty control sites (P .01; analysis of variance and subsequent pairwise Student t test). The mean percentages of mineralized bone were 19.6% ± 6.0% for 100µg/mL PTH, 18.0% ± 6.2% for 20µg/mL PTH, 12.0% ± 6.5% for PEG and HA/TCP without PTH, and 10.5% ± 3.7% for the empty control. The mean areas of bone regenerated within the cylinders were 53.5% ± 22.7% for 100 µg/mL PTH, 51.1% ± 22.6% for 20 µg/mL PTH, 34.3% ± 22.5% for PEG and HA/TCP without PTH, and 23.2% ± 10.1% for the empty control. Discussion: Human and animal trials have demonstrated that daily systemic injection of PTH increases bone mineral density. The present study showed that local administration of PTH was also effective in stimulating bone formation. Conclusion: It is concluded that this synthetic PEG hydrogel containing a covalently bound peptide of the PTH combined with HA/TCP granules significantly stimulated in situ bone augmentation in rabbits. Keywords: bone regeneration, calcium phosphates, graft material, hydroxyapatite, parathyroid hormone, polyethylene glycols