Remyelination has to occur to fully regenerate injured spinal cords or brain tissues. A growing body of evidence has suggested that exogenous cell transplantation is one promising strategy to promote remyelination. However, direct injection of neural stem cells or oligodendrocyte progenitor cells (OPCs) to the lesion site may not be an optimal therapeutic strategy due to poor viability and functionality of transplanted cells resulted from the local hostile tissue environment. The overall objective of this study was to engineer an injectable biocompatible hydrogel system as a supportive niche to provide a regeneration permissive microenvironment for transplanted OPCs to survive, functionally differentiate, and remyelinate central nervous system (CNS) lesions. A highly biocompatible hydrogel, based on thiol-functionalized hyaluronic acid and thiol-functionalized gelatin, which can be crosslinked by poly-(ethylene glycol) diacrylate (PEGDA), was used. These hydrogels were optimized first regarding cell adhesive properties and mechanical properties to best support the growth properties of OPCs in culture. Transplanted OPCs with the hydrogels optimized in vitro exhibited enhanced survival and oligodendrogenic differentiation and were able to remyelinate demyelinated axons inside ethidium bromide (EB) demyelination lesion in adult spinal cord. This study provides a new possible therapeutic approach to treat CNS injuries in which cell therapies may be essential.