The harvesting and implanting of bone graft is a complicated and expensive orthopaedic procedure. This study introduces a unique designed hollow drill bit and a novel technique of rotary ultrasonic drilling of porcine bone to get a precise hole for screw insertion and can harvest cortical bone graft with the least bone debris generation. The new diamond impregnated hollow drill bit is compared with the conventional surgical drill bit with and without providing the ultrasonic vibrations. Also, variation in diamonds grit sizes (fine 70 µm, medium 155 µm, coarse 250 µm) and various process parameters like rotational speeds (500 rpm, 1500 rpm, 2500 rpm), feedrate (10 mm/min, 30 mm/min, 50 mm/min) and amplitude (4 µm, 12 µm, 20 µm) were optimised for enriched graft quality of bone. The diamond hollow tool provides a cylindrical bone graft as per the geometry of hollow bit whereas the surgical drill gives dense spiral-shaped bone debris. While providing no ultrasonic vibrations to hollow bit, segmented bone grafts were observed. The optimised parameters for a continuous uniform rod-shaped bone graft with the least graft deformity are obtained with drilling at rotational speed of 2500 rpm, feedrate of 10 mm/min, using fine (70 µm) diamond abrasives and amplitude of 4 µm. Rotary ultrasonic bone drilling is a better alternative method to reduce the bone debris formation and is capable of providing solid cylindrical rod-shaped cortical bone graft using a fine (70 µm) diamond coated hollow drill tool. This first successful trail-based in-vitro study relates the chip morphology of bone debris with the graft quality of bone obtained during the surgery.