The subcutaneous cellular and tissue alterations that occur during heterotopic osteogenesis induced by a demineralized bone matrix graft in rats were studied morphometrically. Diaphysis segments obtained from 42 rat femurs were cleaned and demineralized with 0.6 M HCl. Each segment was filled with a blood clot and implanted into the back of rats (1 segment/rat). Histological specimens were collected 2, 5, 7, 14, 21, 28 and 49 days after implantation (6 rats/period) and processed after demineralization. Qualitative and morphometric analysis of the histological sections showed that the external blood clots and those filling the medullary canal were replaced with connective tissue within 2-5 days post-implantation. After 14 days, 11.2% and 0.5% of the implanted matrix was replaced with areas of resorption and hyaline cartilage, respectively. After 21 days, 13.7%, 2.4% and 2.7% of the graft matrix showed areas of resorption, cartilage tissue and bone tissue, respectively. At the end of the 49-day study period, 20.2%, 7.8% and 14.5% of the matrix was replaced with areas of resorption, bone tissue and hematopoietic tissue, respectively. Bone induction in rat subcutaneous tissue occurred only at the site of allogenic matrix implantation. The quantity of neoformed cartilage, bone and myeloid tissue depended on the volume of matrix implanted and on the microenvironmental conditions, and was regulated temporally by a cascade of events mediated by bone morphogenetic proteins (BMPs) presents in the graft. These results also show that morphometric methods may be useful for assessing osteoinduction at ectopic sites.