Bone morphogenetic protein-2 (BMP-2) has been demonstrated to be one of the most vital osteogenic factors for bone augmentation. However, its uncontrolled administration has been associated with catastrophic side effects, which compromised its clinical use. To overcome these limitations, we aimed at developing a safer controlled and sustained release of BMP-2, utilizing poly(lactic-co-glycolic acid)-multistage vector composite microspheres (PLGA-MSV). The loading and release of BMP-2 from PLGA-MSV and its osteogenic potential in vitro and in vivo was evaluated. BMP-2 in vitro release kinetics was assessed by ELISA assay. It was found that PLGA-MSV achieved a longer and sustained release of BMP-2. Cell cytotoxicity and differentiation were evaluated in vitro by MTT and alkaline phosphatase (ALP) activity assays, respectively, with rat mesenchymal stem cells. The MTT results confirmed that PLGA-MSVs were not toxic to cells. ALP test demonstrated that the bioactivity of BMP-2 released from the PLGA-MSV was preserved, as it allowed for the osteogenic differentiation of rat mesenchymal stem cells, in vitro. The biocompatible, biodegradable, and osteogenic PLGA-MSVs system could be an ideal candidate for the safe use of BMP-2 in orthopedic tissue engineering applications.