Gene therapy has emerged as a highly promising strategy for the clinical treatment of large segmental bone defects and non-union fractures, which is a common clinical need. Meanwhile, many preclinical data have demonstrated that gene and cell therapies combined with optimal scaffold biomaterials could be used to solve these tough issues. Bone tissue engineering, an interdisciplinary field combining cells, biomaterials, and molecules with stimulatory capability, provides promising alternatives to enhance bone regeneration. To deliver and localize growth factors and associated intracellular signaling components into the defect site, gene therapy strategies combined with bioengineering could achieve a uniform distribution and sustained release to ensure mesenchymal stem cell osteogenesis. In this review, we will describe the process and cell molecular changes during normal fracture healing, followed by the advantages and disadvantages of various gene therapy vectors combined with bone tissue engineering. The growth factors and other bioactive peptides in bone regeneration will be particularly discussed. Finally, gene-activated biomaterials for bone regeneration will be illustrated through a description of characteristics and synthetic methods.