Hydroxyapatite (HAP) based coatings on titanium alloy Ti6Al4V were attempted by sol-gel process. Precursor sol was dip-coated onto the substrates and the formation of HAP as the main phase was ensured after the sintering of coatings at 900 degrees C, as confirmed by the characterization studies involving XRD, FT-IR, Raman, and SEM-EDXS analysis. The biocompatibility of HAP-based coated titanium implants was tested by implantation studies in rabbit's tibia for a period of 8 weeks. Bone remodelling and inflammatory responses of the implants were studied during the implantation period. The better tissue-implant interaction of the coated implants with respect to the uncoated implants was observed after a defect healing period of 8 weeks. A coated implant with no evidence of rejection is a further advantage of the sol-gel derived HAP coating.