In this study, the chitosan scaffold was modified with the simulated body fluid (SBF) which would create a biomimetic layer on the interface between tissues and scaffolds for the bone formation. To investigate the in vivo osteoinduction, the chitosan scaffolds immersed in the SBF for different times were implanted into the calf muscle in male Wistar rats. The tissues blocks containing the scaffolds were harvested at different periods for bone induction assay and examined histologically. Hematoxyline and Eosin staining (H & E staining), Masson’s Trichriome staining and alkaline phosphatase staining (ALPase), were performed for the observation of in vivo biocompatibility, collagen deposition and ALPase activity. Immunohistochemical staining of osteopontin (OPN) and bone sialoprotein (BSP) were used to examine gene expression of these bone proteins and to determine possible development stage of osteoinduction in the specimens with SBF modification. The results in this research suggested that the SBF modification would improve the biocompatibility of chitosan scaffolds, revealed by the decrease in foreign body reaction. With the SBF treatment, the expression of osteoblastic differentiation, including ALPase, OPN and BSP, would be also enhanced. Besides, the above tendencies would be more significant with the longer time for SBF immersion. In conclusion, the chitosan scaffolds modified by using SBF bioreactor would possess excellent biocompatibility and high potential in the promotion of bone regeneration.