Despite current developments in bone substitute technology for spinal fusion, there is a lack of adequate materials for bone regeneration in clinical applications. Recombinant human bone morphogenetic protein-2 (rhBMP-2) is commercially available, but a severe inflammatory response is a known side effect. Bone graft substitutes that enhance osteogenesis without adverse effects are needed. We developed a bioactive molecule-laden PLGA composite with multi-modulation for bone fusion. This bioresorbable composite scaffold was considered for bone tissue engineering. Among the main components, magnesium hydroxide (MH) aids in reduction of acute inflammation affecting disruption of new bone formation. Decellularized bone extracellular matrix (bECM) and demineralized bone matrix (DBM) composites were used for osteoconductive and osteoinductive activities. A bioactive molecule, polydeoxyribonucleotide (PDRN, PN), derived from trout was used for angiogenesis during bone regeneration. A nano-emulsion method that included Span 80 was used to fabricate bioactive PLGA-MH-bECM/DBM-PDRN (PME2/PN) composite to obtain a highly effective and safe scaffold. The synergistic effect provided by PME2/PN improved not only osteogenic and angiogenic gene expression for bone fusion but also improved immunosuppression and polarization of macrophages that were important for bone tissue repair, using a rat model of posterolateral spinal fusion (PLF). It thus had sufficient biocompatibility and bioactivity for spinal fusion.