Neural cell adhesion molecule L1 is a member of the immunoglobulin superfamily; it plays an important role in neurite outgrowth in vitro. We present evidence that the transected optic nerve in adult rats was promoted to regenerate by transplanted L1-expressing cells that were embedded in the Matrigel matrix. To obtain the maximum effects, a very careful operative procedure by which both stumps remained attached and the blood supply was preserved was essential. Visual evoked potential was partially recovered and traced fibers were seen to pass through the lesion site 7 weeks after optic nerve transection. Immunohistochemical analysis demonstrated that neurofilament-positive fibers were present around the site of experimental lesion. Our in vivo study demonstrated that L1 promoted the regeneration of the lesioned optic nerve in rats under strictly controlled environmental conditions.