Carbon nanotubes (CNTs) have attracted significant interest for various applications owing to their superior physicochemical properties. The unzipping of multi-walled carbon nanotubes was accomplished by strong acid treatment. The solution of unzipped carbon nanotubes (u-CNTs) was homogeneous and stable. The u-CNTs were characterized by Fourier transform infrared spectroscopy, X-ray diffraction, and thermogravimetric analysis. The dimensions and morphologies of the synthesized u-CNTs were examined by transmission electron microscopy and scanning electron microscopy. The u-CNTs exhibited increased zeta potential and diameter compared with pure CNTs. A decrease in the thermal stability was observed in the u-CNTs compared with pure CNTs. The u-CNTs exhibited better biocompatibility than pure CNTs in the presence of bone marrow-derived mesenchymal stem cells, showing improved biocompatibility. The u-CNT-treated media generated lower amounts of reactive oxygen species than pure CNTs. Enhanced mineralization was observed in the u-CNT-treated groups compared with the pure CNTs and the control, indicating its better osteogenic potential. The upregulation of osteogenic-associated gene markers in u-CNT groups compared with pure CNTs confirms their superior osteogenic potential. Thus, u-CNTs are potential candidates for tissue engineering applications, especially bone tissue.