Abstract : The purpose of this study was to compare the effect of adipose – tissue derived stem cells (ADSCs), Cod liver oil gel (CLO) and their combination on bone defects created in rabbit femurs. In the current study we used 24 rabbits split into 4 groups. Each group included 6 rabbits, one bony defect in each rabbit femur, with total 12 bony defects/group. Group I (control) bone defect without any treatment, group II (recieved 1000 mg CLO), group III (received 250 million ADSCs gel) and group IV (recieved combination of 250 million ADSCs & 1000 mg CLO gel). All rabbits were sacrificed after 8 weeks. Morphological assessment was done by light microscope (LM). Moreover, genetic assessment was performed by real time- polymerase chain reaction (RT-PCR) to detect genetic expression of surface proteins osteogenic stem cells, osteogenic differentiation, osteoclastogenesis and mineralized bone matrix gene markers. Numerical values were statistically analyzed. LM results revealed better bone healing effect in Group IV and III when compared to other treatment groups. Whereas, RT-PCR observations declared a statistical significant increase in the markers of surface proteins osteogenic stem cells, mineralized bone matrix and osteoclastogenesis markers with statistical significant decrease in osteogenic differentiation markers in Group IV followed by Group III, II and I respectively. Morphologically and genetically, the best healing results with increased bone remodeling were obtained in the group treated with both ADSCs & CLO followed by ADSCs treated then CLO treated group with the least result in untreated control group.