Biodegradable α-tricalcium phosphate (α-TCP) cement based on the chelate-setting mechanism of inositol phosphate (IP6) was developed. This paper examined the effect of the milling time of α-TCP powder on the material properties of the cement. In addition, biocompatibility of the result cement in vitro using osteoblasts and in vivo using rabbit models will be studied as well. The α-TCP powders were ballmilled using ZrO2 beads in pure water for various durations up to 270 minutes, with a single-phase α-TCP obtained at ballmilling for 120 minutes. The resulting cement was mostly composed of α-TCP phase, and the compressive strength of the cement was 8.5±1.1 MPa, which suggested that the cements set with keeping the crystallite phase of starting cement powder. The cell-culture test indicated that the resulting cements were biocompatible materials. In vivo studies showed that the newly formed bones increased with milling time at a slight distance from the cement specimens and grew mature at 24 weeks, and the surface of the cement was resorbed by tartrate-resistant acid phosphatase-(TRAP-)positive osteoclast-like cells until 24 weeks of implantation. The present α-TCP cement is promising for application as a novel paste-like artificial bone with biodegradability and osteoconductivity.