Initial take, development, and function of transplanted engineered tissue substitutes are crucially dependent on rapid and adequate blood perfusion. Therefore, the development of rapidly and efficiently vascularized tissue grafts is vital for tissue engineering and regenerative medicine. Here we report on the construction of a network of highly organotypic capillaries in engineered tissue substitutes. We employed a three-dimensional culture system consisting of human microvascular endothelial cells. These were reproducibly expanded at high purity and subsequently seeded into biodegradable, fibrin-based hydrogels. The process of capillary formation in vitro followed the principles of both angiogenesis and postnatal vasculogenesis and a distinct sequence of other developmental steps that closely resemble embryonic neovascularization. Capillary lumen formation in vitro was initiated by the deposition of a basement membrane and intensive pinocytosis, followed by the generation of intracellular vacuoles, successive fusion of these vacuoles, and finally the formation of a long, continuous lumen. After transplantation the vascular structures were stabilized by mural cells of the recipient animal. Our findings suggest that the in vitro engineering of prevascularized matrices is within reach.