The aim was to synthesize bioactive electrospun fibers for biomedical and dental application with improved biocompatibility. In situ precipitation of nano-hydroxyapatite (nHA) was performed with various concentrations (0.5%, 1%, 2%, 3%, and 5% wt/wt) of functionalized multi-walled-carbon nanotubes (MWCNTs) by using microwave irradiation technique. The obtained composites were characterized by Fourier Transform Infrared (FTIR), X-ray Diffraction (XRD), Thermogravimetric Analysis/Differential Scanning Calorimetry (TGA/DSC), and the cylindrical discs were made for mechanical testing. The failure behavior was analyzed by Scanning Electron Microscope (SEM). CNT and HA/CNT were silanized with γ-methacryloxypropyl-trimethoxysilane (MPTS) and mixed with polyvinyl alcohol (10% wt./vol.) and electrospun to fabricate fibers. The biocompatibility of both fibers was accessed by their effects on angiogenesis in a chick chorioallantoic membrane (CAM) assay. The electrospun fibers were analyzed by SEM. FTIR confirmed the structural behavior of pre and post-silanized HA/CNT. XRD showed the phase purity and crystallinity before and after heat treatment. Mechanical properties showed that 3% loaded HA/CNT has higher compressive strength (100.5 ± 5.9 MPa) compared to others and the failure behavior exhibited dispersion of CNT in HA matrix. The HA/CNT electrospun fibers showed significantly more blood vessels formation compared to CNT fibers. These HA/CNT electrospun fibers showed promising results in terms of biocompatibility and with improved mechanical properties of CNT reinforced composites, they can be used in load bearing clinical applications.