Calcium phosphate cement (CPC) has limited use in bone repair due to their poor mechanical properties. Halloysite nanotubes (HNTs) are clay tubes with an aluminosilicate composition. The physicochemical properties, cytocompatibility, and cellular response to the CPC/HNT composites were assayed. Compression strength, FTIR analysis, protein synthesis, and mineralization were assessed. The cumulative data show that composites of tricalcium phosphate (TCP), anhydrous calcium diphosphate (DCPA) as the solid phase agent, and 10% chitosan lactate solution as the setting liquid produced cement with sustained release properties without loss of material strength. The composite also showed enhanced material properties (adhesiveness, surface roughness, and increased strength). Cellular assays confirm its osteoconductive and osteoinductive nature. CPCs, loaded with gentamicin- and neomycin-doped HNTs, showed sustained antibacterial release and marked zone of growth inhibition. CPCs fabricated with drug-doped HNTs offer a means for inducing bone growth at the site of implantation while controlling infection. This treatment modality should hasten patient healing time and enhance restoration of function. The increase in materials properties suggests that this CPC may be clinically applied to repair injuries in load-bearing bones.