<p>Inflammation is a key physiological process in the regeneration of bone tissue following injury. The acute inflammatory response, along with the timely resolution of inflammation, is essential for effective bone tissue repair. Exacerbation of either acute or chronic inflammation can lead to impaired bone regeneration, which is closely associated with interactions between immune cells and bone-related cells, as well as the regulatory roles of various inflammatory cytokines. In this review, we discuss the role of the immune microenvironment in bone regeneration and the negative impact of dysregulated inflammation on bone regeneration, and highlight on the need for timely elimination of inflammation. Additionally, the application of nanobiomaterials with immunomodulatory function in the treatment of inflammatory bone defects is discussed to clarify its current challenges and the future direction of its development.</p>