Engineering novel scaffolds that can mimic the functional extracellular matrix (ECM) would be a great achievement in bone tissue engineering. This paper reports the fabrication of novel collagen/chitosan/β-tricalcium phosphate (CCTP) based tissue engineering scaffold. In order to improve the regeneration ability of scaffold, we have embedded raloxifene (RLX)-loaded PLGA microsphere in the CCTP scaffold. The average pore of scaffold was in the range of 150–200 μm with ideal mechanical strength and swelling/degradation characteristics. The release rate of RLX from the microsphere (MS) embedded scaffold was gradual and controlled. Also a significantly enhanced cell proliferation was observed in RLX-MS exposed cell group suggesting that microsphere/scaffold could be an ideal biomaterial for bone tissue engineering. Specifically, RLX-MS showed a significantly higher Alizarin red staining indicating the higher mineralization capacity of this group. Furthermore, a high alkaline phosphatase (ALP) activity for RLX-MS exposed group after 15 days incubation indicates the bone regeneration capacity of MC3T3-E1 cells. Overall, present study showed that RLX-loaded microsphere embedded scaffold has the promising potential for bone tissue engineering applications.