We have previously demonstrated that blending biodegradable glycine co-substituted polyphosphazenes with poly(lactide-co-glycolide) (PLAGA) results in novel biomaterials with versatile properties. The study showed that the degradation rate of polyphosphazene/PLAGA blends can be effectively controlled by varying the blend composition while at the same time the degradation products of polyphosphazenes effectively neutralized the acidic degradation products of PLAGA. In the present study, novel blends of hydrophobic, biodegradable polyphosphazene, poly[bis(ethyl alanato) phosphazene] (PNEA) and PLAGA (LA: GA; 85:15) were developed as candidates for bone tissue engineering applications. Two different blend compositions were developed by blending PNEA and PLAGA having weight ratios of 25:75 (Blend-1) and 50:50 (Blend-2) by the mutual solvent technique using dichloromethane as the solvent. The miscibility of the blends was determined using differential scanning calorimetry (DSC), fourier transform-infrared spectroscopy (FT-IR), and scanning electron microscopy (SEM). Surface analysis of the blends by SEM revealed a smooth uniform surface for Blend-1, whereas Blend-2 showed evidence of phase separation. PNEA is not completely miscible with PLAGA, as evidenced from DSC and FT-IR measurements. The osteocompatibilities of Blend-1 and Blend-2 were compared to those of parent polymers by following the adhesion and proliferation of primary rat osteoblast cells on two dimensional (2-D) polymer and blend films over a 21 day period in culture. Blend films showed significantly higher cell numbers on the surface compared to PLAGA and PNEA films.