In mature skin, wound repair typically begins with hemostasis and inflammation. This is followed by a proliferative phase with reepithelialization, angiogenesis, and collagen production, and ends with the generation of a permanent scar. However, animal studies and clinical observations have shown that a different type of healing occurs in fetal skin in the first two trimesters of development. In early fetal skin, wounds exhibit a unique pattern of wound healing leading to regeneration. Notably, repair in the fetus takes place with little or no inflammation, faster reepithelialization, and no scarring. Although research in scarless fetal healing began several decades ago, the exact mechanisms of how this regenerative process takes place remain unknown. Knowing how the fetus will respond to potential injury from invasive diagnostic procedures or surgery is essential, especially given the development of less invasive fetal surgical techniques which could increase the number of fetal surgeries. In addition, insights into regenerative healing may provide information about how to accelerate postnatal wound healing as well as how to improve healing from a cosmetic standpoint. Future research directions include identification of the molecular controls responsible for scarless healing, with the intention that this new information will lead to improved therapeutic strategies for wound healing.