Craniofacial bone regeneration is crucial for restoring the form and function of underlying vital structures. However, the unique physicochemical and biologic requirements of it make this task challenging. Two types of polyphasic composite scaffolds were therefore developed by polymeric template replication process from magnesium aluminate (MgAl2O4) spinel, β-tricalcium phosphate (β-TCP) and polymers; poly lactic-co-glycolic acid (PLGA) or poly caprolactone (PCL). The scaffolds: spinel/β-TCP/PLGA and spinel/β-TCP/PCL were physicochemically characterized at each stage of development followed by evaluation of compressive strength, porosity, in vitro degradation and ion release. Their morphology was then assessed for trabecular parameters: trabecular number, thickness, spacing, structural model index and degree of anisotropy. Their interactions with mesenchymal stem cells were also studied. Both the scaffolds showed compressive strength and porosity of craniofacial bones. However, trabecular parameters, degradation, ion release, cell viability / proliferation / deposition inside the scaffold were better for spinel/β- TCP/PLGA. Further, its internal morphology was similar to cancellous bone, optimum for cellular and vascular permeation. The scaffold also underwent significant degradation in four months releasing calcium, magnesium and phosphorus. Up regulation of genes pertaining to bone morphogenesis, development, differentiation, mineralization, ossification, remodeling were found along with transmembrane and notch receptor genes. All these led to the activation of major osteogenic pathways mediated by TGF/BMP/WNT/integrin families and notch signaling, with significant contributions from Mg ions. The genes with specific role in osteogenesis were also validated. Overall, magnesium aluminate based polyphasic composite scaffold: spinel/β-TCP/PLGA demonstrated physical and biologic characteristics essential for in vitro craniofacial bone tissue engineering.