Despite advances in wound closure techniques and devices, there is still a critical need for new methods of enhancing the healing process to achieve optimal outcomes. Recently, stem cell therapy has emerged as a new approach to accelerate wound healing. Adipose-derived stem cells (ASCs) hold great promise for wound healing, because they are multipotential stem cells capable of differentiation into various cell lineages and secretion of angiogenic growth factors. The aim of this study was to evaluate the benefit of ASCs on wound healing and then investigate the probable mechanisms. ASCs characterized by flow cytometry were successfully isolated and cultured. An excisional wound healing model in rat was used to determine the effects of locally administered ASCs. The gross and histological results showed that ASCs significantly accelerated wound closure in normal and diabetic rat, including increased epithelialization and granulation tissue deposition. Furthermore, we applied GFP-labeled ASCs on wounds to determine whether ASCs could differentiate along multiple lineages of tissue regeneration in the specific microenvironment. Immunofluorescent analysis indicated that GFP-expressing ASCs were costained with pan-cytokeratin and CD31, respectively, indicating spontaneous site-specific differentiation into epithelial and endothelial lineages. These data suggest that ASCs not only contribute to cutaneous regeneration, but also participate in new vessels formation. Moreover, ASCs were found to secret angiogenic cytokines in vitro and in vivo, including VEGF, HGF, and FGF2, which increase neovascularization and enhance wound healing in injured tissues. In conclusion, our results demonstrate that ASC therapy could accelerate wound healing through differentiation and vasculogenesis and might represent a novel therapeutic approach in cutaneous wounds.