BACKGROUND CONTEXT: The safety of allograft material has come under scrutiny because of recent reports of allograft-associated bacterial and viral infections in tissue recipients. Gamma irradiation, although being one of the most effective ways of terminal sterilization, has been shown to affect the biomechanical properties of allograft bone. It may also have detrimental effects on the osteoinductivity of allograft material such as demineralized bone matrix (DBM) by the denaturation of proteins because of heat generated by irradiation. Sterilization of DBM material is an important variable in processing graft materials. This is considered to be one of the factors leading to different fusion rates observed with different commercially available DBM products, as the sterilization procedure itself may affect the osteoinductivity of the material. Currently, there is no ideal sterilization technique that limits the detrimental effect on osteoinductivity and fusion rates. PURPOSE: To evaluate the effects of a range of hydrogen peroxide exposures with or without the controlled high-dose gamma irradiation after processing with radioprotectant solutions (Clearant radiation sterilization procedure) on the fusion rates of human DBM. STUDY DESIGN: A prospective in vivo animal study. METHODS: Eighty mature athymic nude female rats were used for this study, which formed 10 equal groups. Human DBM exposed to hydrogen peroxide for different time periods (0, 1, 6, and 24 hours) was divided into two major subgroups. One group was further treated with controlled high-dose radiation using radioprotectants (radiation treated), whereas the other group was frozen immediately without specific treatment (non-radiation treated). Both radiation-treated and non-radiation-treated DBM material from each group of hydrogen peroxide exposure times were implanted between L4 and L5 transverse processes of the rats forming eight test groups including eight animals in each. The remaining 16 rats were divided into two additional groups to form negative (only decortication, n=8) and positive (bone morphogenetic protein [BMP]-2, n=8) control groups. The rats were evaluated for fusion by radiographs (2, 4, and 8 weeks), manual palpation (8 weeks), and histological analysis after sacrificing. Comparison of fusion rate among all groups was made using these three evaluation methods. RESULTS: Increasing the time period of hydrogen peroxide (0, 1, 6, or 24 hours) exposure for preparation of DBM from bone allograft did not affect the fusion rates significantly (p<.05), although there was a trend toward decreasing fusion rates with longer exposure times. When the hydrogen peroxide washed DBM preparations were also radiation treated, the resulting fusion rates were again not significantly different (p<.05). Agreement among fusion detection methods was found to be high. CONCLUSIONS: Hydrogen peroxide processing was not detrimental to fusion rates. The additional terminal sterilization technique with special gamma irradiation protocols (Clearant process) also did not decrease the fusion rates but could provide an additional margin of safety.