The proximal humerus is a common site for primary malignant and benign aggressive bone tumors, necessitating wide resection and subsequent skeletal defect reconstruction. Various reconstruction options include osteoarticular allografts, autografts, endoprosthesis, nail-cement spacer, reverse shoulder arthroplasty, and allograft-prosthesis composites. However, there is no consensus on the optimal reconstruction method. This study aims to compare functional outcomes and complications between these two methods. A total of 40 patients with proximal humerus tumors who underwent endoprosthesis or nail-cement spacer reconstruction between March 2012 and December 2020 were included. The mean follow-up in the study was 31.37+/- 12 months. Demographic and clinical data were collected, and functional outcomes were assessed using the Musculoskeletal Tumor Society 93 scoring system and the Disabilities of the Arm, Shoulder, and Hand questionnaire. Complications and oncological outcomes were recorded. Both groups were similar in terms of demographic and clinical variables. Endoprosthesis reconstruction demonstrated significantly better active shoulder forward flexion compared to nail-cement spacer (45.8 vs. 25.2 degrees) (P=.015). Endoprosthesis group also exhibited greater active shoulder internal rotation (68.25 vs. 63.25 degrees) (P=.004). No statistically significant differences were observed in overall functional outcomes. Complications, including radial nerve palsy and infection, were comparable between groups, with one case of spacer loosening. Both endoprosthesis and nail-cement spacer reconstruction provide comparable functional outcomes and complication rates following proximal humerus tumor resection. Nail-cement spacer offers a cost-effective alternative for patients in resource-constrained settings.