A novel method of living bone allotransplantation combining microvascular repair of the nutrient circulation, implantation of host-derived arteriovenous (AV) bundles, and short-term immunosuppression is described. We hypothesized that neoangiogenesis from the implanted vessels would maintain graft viability and circulation after withdrawal of FK506 (Tacrolimus) immunosuppression. Vascularized femoral transplantation was performed between DA and PVG rats. In addition to microsurgical pedicle anastomoses, a saphenous AV bundle from the recipient animal was implanted in the medullary space. Ninety-seven rats were randomly allocated to groups differing in immunosuppression and AV bundle patency. Implanted vessels significantly improved capillary density and bone blood flow in nonimmunosuppressed and immmunosuppressed groups, respectively. A lower incidence of spontaneous AV bundle thrombosis was found with Tacrolimus treatment. More viable osteocytes were seen at 4 weeks when the AV bundle was patent. Further investigations may confirm host-derived neoangiogenesis as an alternative to tolerance induction or immunosuppression in bone allotransplantation.