Bone defects caused by bone trauma, infection, surgery, or other systemic diseases remain a severe challenge for the medical field. To address this clinical problem, different hydrogels were exploited to promote bone tissue regrowth and regeneration. Keratins are natural fibrous proteins found in wool, hair, horns, nails, and feather. Due to their unique characteristics of outstanding biocompatibility, great biodegradability, and hydrophilic, keratins have been widely applicated in different fields. In our study, the feather keratin-montmorillonite nanocomposite hydrogels that consist of keratin hydrogels serving as the scaffold support to accommodate endogenous stem cells and montmorillonite is synthesized. The introduction of montmorillonite greatly improves the osteogenic effect of the keratin hydrogels via bone morphogenetic protein 2 (BMP-2)/phosphorylated small mothers against decapentaplegic homolog 1/5/8 (p-SMAD 1/5/8)/runt-related transcription factor 2 (RUNX2) expression. Moreover, the incorporation of montmorillonite into hydrogels can improve the mechanical properties and bioactivity of the hydrogels. The morphology of feather keratin-montmorillonite nanocomposite hydrogels was shown by scanning electron microscopy (SEM) to have an interconnected porous structure. The incorporation of montmorillonite into the keratin hydrogels was confirmed by the energy dispersive spectrum (EDS). We prove that the feather keratin-montmorillonite nanocomposite hydrogels enhance the osteogenic differentiation of BMSCs. Furthermore, micro-CT and histological analysis of rat cranial bone defect demonstrated that feather keratin-montmorillonite nanocomposite hydrogels dramatically stimulated bone regeneration in vivo. Collectively, feather keratin-montmorillonite nanocomposite hydrogels can regulate BMP/SMAD signaling pathway to stimulate osteogenic differentiation of endogenous stem cells and promote bone defect healing, indicating their promising candidate in bone tissue engineering.