There is enormous worldwide demand for therapies to promote the efficient resolution of hard-to-heal wounds with minimal appearance of scarring. Recent in vitro studies with mesenchymal stem cells (MSCs) have identified numerous mechanisms by which these cells can promote the process of wound healing, and there is significant interest in the clinical translation of an MSC-based therapy to promote dermal regeneration. This review provides a systematic analysis of recent preclinical and clinical research to evaluate the use of MSCs in wound healing applications. These in vivo studies provide overwhelming evidence that MSCs can accelerate wound closure by modulating the inflammatory environment, promoting the formation of a well-vascularized granulation matrix, encouraging the migration of keratinocytes, and inhibiting apoptosis of wound healing cells. The trophic effects of MSC therapy also appear to augment wound healing in diabetic tissues, thereby preventing the formation of nonhealing ulcers. Finally, a number of delivery systems have been evaluated and indicate that MSCs could be the basis of a versatile therapy to fulfill the clinical needs for dermal regeneration. However, despite the apparent advantages of MSC-based therapies, there have been only limited clinical investigations of this type of therapy in humans. Thus, our review concludes with a discussion of the translational barriers that are limiting the widespread clinical use of MSCs to enhance wound healing.