This paper reports a new approach to fabricating biocompatible porous titanium with controlled pore structure and net-shape. The method is based on using sacrificial Mg particles as space holders to produce compacts that are mechanically stable and machinable. Using magnesium granules and Ti powder, Ti/Mg compacts with transverse rupture strength (~ 85 MPa) sufficient for machining were fabricated by warm compaction, and a complex-shape Ti scaffold was eventually produced by removal of Mg granules from the net-shape compact. The pores with the average size of 132–262 μm were well distributed and interconnected. Due to anisotropy and alignment of the pores the compressive strength varied with the direction of compression. In the case of pores aligned with the direction of compression, the compressive strength values (59–280 MPa) high enough for applications in load bearing implants were achieved. To verify the possibility of controlled net-shape, conventional machining process was performed on Ti/Mg compact. Compact with screw shape and porous Ti scaffold with hemispherical cup shape were fabricated by the results. Finally, it was demonstrated by cell tests using MC3T3-E1 cell line that the porous Ti scaffolds fabricated by this technique are biocompatible.