The treatment of Gustilo-Anderson type III open femoral fracture with large segmental bone defect remains a challenge for orthopedic trauma surgeons. The aims of management are first to prevent the risk of infection and then to reconstruct the bone loss with correct alignment and length. The induced membrane technique (or Masquelet technique) was initially described for tibia nonunion but became over the years an established procedure to treat any kind of large bone defect. The case of a 22-year old male who sustained an open femoral shaft fracture with a circumferential 7-cm bone defect after a car accident is presented. Given the critical size of the bone loss, we chose to manage this patient using a modified-Masquelet technique, in which we stabilized the fracture by an intramedullary femoral nail and filled only the lateral side of the defect with a cement spacer. He went on to have a full and successful union of his fracture 16-weeks after the second stage surgery. The final functional outcomes were excellent allowing the patient to resume all activities without restriction.