OBJECTIVE The objective of this study was to evaluate the effects of oil-based calcium hydroxide on mandibular lengthening during distraction osteogenesis. METHODS Twenty-four New Zealand white rabbits underwent unilateral mandibular osteotomy. The rabbits were divided into 4 groups containing 6 each: groups 1 and 3 were control groups and groups 2 and 4 were test groups. Oil-based calcium hydroxide suspension was applied to test groups' corticotomy gap after osteotomy during operation. No treatment was applied to the control groups. After 5 days' latency period, distraction was commenced at a rate of 0.8 mm/day for 10 days via custom-made distractor. Groups 1 and 2 were killed 14 days after distraction and groups 3 and 4 were killed 28 days after distraction. RESULTS Quantitative computerized tomography evaluation did not demonstrate a difference mean the density and the area of the regeneration between groups 1 and 3, but there was a significant difference groups 2 and 4. Histomorphometric evaluation demonstrated that there was a significant difference between test and control groups in new bone volume formation during distraction osteogenesis. CONCLUSIONS Application of oil-based calcium hydroxide paste during the osteotomy phase of distraction osteogenesis increased regeneration and new bone volume formation.