The treatment of bone defects has been a long-standing challenge in clinical practice. Among the various bone tissue engineering approaches, there has been substantial progress in the development of drug delivery systems based on functional drugs and appropriate carrier materials owing to technological advances in recent years. A large number of materials based on functional nanocarriers have been developed and applied to improve the complex osteogenic microenvironment, including for promoting osteogenic activity, inhibiting osteoclast activity, and exerting certain antibacterial effects. This Review discusses the physicochemical properties, drug loading mechanisms, advantages and disadvantages of nanoparticles (NPs) used for constructing drug delivery systems. In addition, we provide an overview of the osteogenic microenvironment regulation mechanism of drug delivery systems based on nanoparticle (NP) carriers and the construction strategies of drug delivery systems. Finally, the advantages and disadvantages of NP carriers are summarized along with their prospects and future research trends in bone tissue engineering. This Review thus provides advanced strategies for the design and application of drug delivery systems based on NPs in the treatment of bone defects.