This paper describes a segmentation algorithm designed to separate bone from soft tissue in magnetic resonance (MR) images developed for computer-assisted surgery of the spine. The algorithm was applied to MR images of the spine of healthy volunteers. Registration experiments were carried out on a physical model of a spine generated from computed tomography (CT) data of a surgical patient. Segmented CT, manually segmented MR and MR images segmented using the developed algorithm were compared. The algorithm performed well at segmenting bone from soft tissue on images taken of healthy volunteers. Registration experiments showed similar results between the CT and MR data. The MR data, which were manually segmented, performed worse on visual verification experiments than both the CT and semi-automatic segmented data. The algorithm developed performs well at segmenting bone from soft tissue in MR images of the spine as measured using registration experiments.