Abstract: The invention is directed to a method and apparatus for producing bone graft material for use in conjunction with bone grafting procedures wherein fragments of bone material are placed within a hollow receptacle (12) which has a periphery wall defining a milling chamber and a removable base plate (11) which is releasably secured by fasteners (13) to the open bottom end of the receptacle (12). A crushing tool (18) slidably engages within the chamber and is caused to impact against the bone fragments so as to consolidate same into a solid physical mass, whereafter the consolidated crushed bone material is machined or ground using a spherical reamer (22) attached to a power drill (23). Preferably the bone material is crushed by means of a hammer (20) which is manually impacted against the top end of the crushing tool (18).