Craniofacial bone defects can be caused by accidents, diseases, heredity, and so on, which significantly affect patients' facial function and appearance. Clinical treatments, including autografts, allografts, and artificial implants, face challenges such as the need for secondary surgery, uncertain retention time, and immune rejection. Hydrogels, as promising regenerative biomaterials, offer excellent biocompatibility and three-dimensional structural support; however, traditional hydrogels frequently struggle to simultaneously provide both mechanical strength and potent biological cues for bone regeneration. Herein we report a methacrylated gelatin hydrogel covalently crosslinked by vinyl-coated iron oxide nanoparticles. In this system, the nanoparticles act as structural hubs to strengthen the polymer network, allowing for the combined regulation of mechanical and biological properties while also providing the unique functional properties of iron. The nanoparticle-crosslinked hydrogels exhibited improved mechanical properties and bone induction compared to conventional crosslinked hydrogels. They showed increased stiffness while maintaining excellent biocompatibility. Due to the positive effects of iron oxide on angiogenesis and osteogenesis induction, the hybrid hydrogel can promote the in vitro osteogenic differentiation of bone marrow stem cells (BMSCs) and angiogenesis of human umbilical vein endothelial cells (HUVECs). In the cranial defects of the rat experiment, the iron oxide nanoparticles crosslinked hydrogels enhanced the vascular structure regeneration and bone regrowth. Thus, the nanoparticles-crosslinked hydrogels substantially enhanced neovascularization and accelerated new bone formation. This study provided valuable insights for the design of metal oxide nanoparticles crosslinked hydrogels for bone tissue engineering and supplied a new strategy for efficient and safe craniofacial bone repair. This study presents a powerful design principle where a single nanomaterial component is engineered to resolve the long-standing trade-off between mechanical stability and sustained bioactivity, supplying a new strategy for efficient and safe craniofacial bone repair.