In this study, we aimed to develop a novel soy-based polyurethane (PU) foam material reinforced with titanium powder and collagen for use in bone tissue engineering. In this context, soy polyol-based PU foams having different (5, 10, 20 wt%) concentrations of recycled titanium powders and hydrolyzed collagen (1 wt%) were prepared and characterized by scanning electron microscopy, water contact angle measurement, and compression tests. Biocompatibility was determined by cytotoxicity analysis. It was observed that PU foams with different titanium and collagen concentrations can have optimized mechanical strength, biocompatibility, chemical composition, and morphology that resemble porous bone texture-like structure. The compressive strength of PU foam increased by 72.6% with the inclusion of 20 wt% titanium powder and slightly decreased by 9.4% with 1 wt% collagen. Cytotoxicity results revealed that PU foam with the synergistic combination of titanium powder and collagen had higher biocompatibility compared to control sample. To our knowledge, this novel biocomposite material, developed the first time in literature by incorporation of medical grade titanium powder and hydrolyzed collagen into soy-based PU matrix, has many advantages such as tunable mechanical strength, biocompatibility, low cost, and easy processability.