In vitro and in vivo experiments were undertaken to evaluate the solubility, apatite‐forming ability, cytocompatibility, osteostimulation, and osteoinduction for a series of Nb‐containing bioactive glass (BGNb) derived from composition of 45S5 Bioglass. Inductively coupled plasma optical emission spectrometry (ICP‐OES) revealed that the rate at which Na, Ca, Si, P, and Nb species are leached from the glass decrease with the increasing concentration of the niobium oxide. The formation of apatite as a function of time in simulated body fluid was monitored by 31P Magic Angle Spinning (MAS) Nuclear magnetic resonance spectroscopy. Results showed that the bioactive glasses: Bioglass 45S5 (BG45S5) and 1 mol%‐Nb‐containing‐bioactive glass (BGSN1) were able to grow apatite layer on their surfaces within 3 h, while glasses with higher concentrations of Nb2O5 (2.5 and 5 mol%) took at least 12 h. Nb‐substituted glasses were shown to be compatible with bone marrow‐derived mesenchymal stem cells (BMMSCs). Moreover, the bioactive glass with 1 mol% Nb2O5 significantly enhanced cell proliferation after 4 days of treatment. Concentrations of 1 and 2.5 mol% Nb2O5 stimulated osteogenic differentiation of BMMSCs after 21 days of treatment. For the in vivo experiments, trial glass rods were implanted into circular defects in rat tibia in order to evaluate their osteoconductivity and osteostimulation. Two morphometric parameters were analyzed: (a) thickness of new‐formed bone layer and (b) area of new‐formed subperiostal bone. Results showed that BGNb bioactive glass is osteoconductive and osteostimulative. Therefore, these results indicate that Nb‐substituted glass is suitable for biomedical applications.