Chronic diseases confer tissue and organ damage that reduce quality of life and are largely refractory to therapy. Although stem cells hold promise for treating degenerative diseases by 'seeding' injured tissues, the regenerative capacity of stem cells is influenced by regulatory networks orchestrated by local immune responses to tissue damage, with macrophages being a central component of the injury response and coordinator of tissue repair. Recent research has turned to how cellular and signaling components of the local stromal microenvironment (the 'soil' to the stem cells' seed), such as local inflammatory reactions, contribute to successful tissue regeneration. This Review discusses the basic principles of tissue regeneration and the central role locally acting components may play in the process. Application of seed-and-soil concepts to regenerative medicine strengthens prospects for developing cell-based therapies or for promotion of endogenous repair.