Bone allografts are inferior to autografts for the repair of critical-sized defects. Prior studies have suggested that bone morphogenetic protein-2 (BMP-2) can be combined with allografts to produce superior healing. We created a bioactive coating on bone allografts using polycondensed deoxyribose isobutyrate ester (PDIB) polymer to deliver BMP-2 ± the bisphosphonate zoledronic acid (ZA) and tested its ability to enhance the functional utility of allografts in preclinical Wistar rat models. One ex vivo and two in vivo proof-of-concept studies were performed. First, PDIB was shown to be able to coat bone grafts (BGs). Second, PDIB was used to coat structural allogenic corticocancellous BG with BMP-2 ± ZA ± hydroxyapatite (HA) microparticles and compared with PDIB-coated grafts in a rat muscle pouch model. Next, a rat critical defect model was performed with treatment groups including (i) empty defect, (ii) BG, (iii) collagen sponge + BMP-2, (iv) BG + PDIB/BMP-2, and (v) BG + PDIB/BMP-2/ZA. Key outcome measures included detection of fluorescent bone labels, microcomputed tomography (CT) quantification of bone, and radiographic healing. In the muscle pouch study, BMP-2 did not increase net bone volume measured by microCT, however, fluorescent labeling showed large amounts of new bone. Addition of ZA increased BV by sevenfold (p < 0.01). In the critical defect model, allografts were insufficient to promote reliable union, however, union was achieved in collagen/BMP-2 and all BG/BMP-2 groups. Statement of clinical significance: These data support the concept that PDIB is a viable delivery method for BMP-2 and ZA delivery to enhance the bone forming potential of allografts. © 2019 Orthopaedic Research Society. Published by Wiley Periodicals, Inc. J Orthop Res 37:2278-2286, 2019.