Co-cultures of endothelial cells (EC) and mesenchymal stem cells (MSC) in three-dimensional (3D) protein hydrogels can be used to recapitulate aspects of vasculogenesis in vitro. MSC provide paracrine signals that stimulate EC to form vessel-like structures, which mature as the MSC transition to the role of mural cells. In this study, vessel-like network formation was studied using 3D collagen/fibrin (COL/FIB) matrices seeded with embedded EC and MSC and cultured for 7 days. The EC:MSC ratio was varied from 5:1, 3:2, 1:1, 2:3 and 1:5. The matrix composition was varied at COL/FIB compositions of 100/0 (pure COL), 60/40, 50/50, 40/60 and 0/100 (pure FIB). Vasculogenesis was markedly decreased in the highest EC:MSC ratio, relative to the other cell ratios. Network formation increased with increasing fibrin content in composite materials, although the 40/60 COL/FIB and pure fibrin materials exhibited the same degree of vasculogenesis. EC and MSC were co-localized in vessel-like structures after 7 days and total cell number increased by approximately 70%. Mechanical property measurements showed an inverse correlation between matrix stiffness and network formation. The effect of matrix stiffness was further investigated using gels made with varying total protein content and by crosslinking the matrix using the dialdehyde glyoxal. This systematic series of studies demonstrates that matrix composition regulates vasculogenesis in 3D protein hydrogels, and further suggests that this effect may be caused by matrix mechanical properties. These findings have relevance to the study of neovessel formation and the development of strategies to promote vascularization in transplanted tissues.