Biomaterials designed to replace the diseased cornea could be used to treat corneal blindness where human donor tissue is in short supply, but challenges are the integration of biomaterials with host tissue and cells, avoiding a rapid material degradation and maintaining corneal transparency. Additionally, implantation surgery often triggers an aggressive wound healing response that can lead to corneal thinning and opacity. Here, we report a collagen-based hydrogel with transparency and mechanical properties suitable for replacing a substantial portion of a damaged or diseased corneal stroma. The porous hydrogel permitted migration and population by host cells while maintaining transparency and thickness six months after surgical implantation in an in vivo model of human corneal surgery. With a novel hybrid surgical implantation technique inspired by LASIK refractive surgery, rapid wound healing occurred around implants to maintain biomaterial integrity, transparency and function. Host stromal cell repopulation and regeneration of host epithelium and nerves were observed, as necessary steps towards corneal regeneration. Finally, as a proof-of-principle, the hydrogel loaded with a neuroregenerative drug achieved sustained slow-release drug delivery in vitro. The proposed hydrogel and novel implantation technique together represent a therapeutic approach with translational potential for replacing and regenerating diseased corneal stromal tissue.