Degree of deacetylation (DDA) and molecular weight (MW) of chitosans are important to their physical and biological properties. In this study, two chitosans, HS (DDA = 73.3%) and AT (DDA = 76.8%), were deacetylated with 45% sodium hydroxide under nitrogen atmosphere at 80 °C or 90 °C for up to 120 min, to obtain two series of chitosans. The polymers produced were characterized for MW by gel permeation chromatography, DDA by titration and UV-vis methods, and crystallinity, hydrophilicity and thermal stability by X-ray diffraction, water contact angle and differential scanning calorimetry respectively. Films, made by solution casting in dilute acetic acid at ambient conditions, were evaluated for biological activity by albumin adsorption and the attachment and growth of a pre-osteoblast cell line. Chitosans with between 80–93% DDA’s (based on titration) were reproducibly obtained. Even though deacetylation under nitrogen was supposed to limit chain degradation during decetylation, MW decreased (by maximum of 37.4% of HS and 63.0% for AT) with increasing deacetylation reaction time and temperature. Crystallinity and decomposition temperature increased and water contact angles decreased with processing to increase DDA. Significantly less albumin was absorbed on films made with 93% DDA chitosans as compared with the original materials and the AT chitosans absorbed less than the HS chitosans. The cells on higher DDA chitosan films grew faster than those on lower DDA films. In conclusion, processing conditions increased DDA and influenced physicochemical and biological properties. However, additional studies are needed to unambiguously determine the influence of DDA or MW on in vitro and in vivo performance of chitosan materials for bone/implant applications.