A variety of diseases may lead to hysterectomies or uterine injuries, which may form a scar and lead to infertility. Due to the limitation of native materials, there are a few effective methods to treat such damages. Tissue engineering combines cell and molecular biology with materials and mechanical engineering to replace or repair damaged organs and tissues. The use of human embryonic stem cells (hESCs) as a donor cell source for the replacement therapy will require the development of simple and reliable cell differentiation protocols. This study aimed at efficiently generating endometrium-like cells from the hESCs and at using these cells with collagen scaffold to repair uterine damage. The hESCs were induced by co-culturing with endometrial stromal cells, and simultaneously added cytokines: epidermal growth factor (EGF), platelet-derived growth factor-b (PDGF-b), and E2. Expression of cell specific markers was analyzed by immunofluorescence and reverse trascription-polymerase chain reaction to monitor the progression toward an endometrium-like cell fate. After differentiation, the majority of cells (>80%) were positive for cytokeratin-7, and the expression of key transcription factors related to endometrial development, such as Wnt4, Wnt7a, Wnt5a, Hoxa11, and factors associated with endometrial epithelial cell function: Hoxa10, Intergrinβ3, LIF, ER, and PR were also detected. Then, we established the uterine full-thickness-injury rat models to test cell function in vivo. hESC-derived cells were dropped onto collagen scaffolds and transplanted into the animal model. Twelve weeks after transplantation, we discovered that the hESC-derived cells could survive and recover the structure and function of uterine horns in a rat model of severe uterine damage. The experimental system presented here provides a reliable protocol to produce endometrium-like cells from hESCs. Our results encourage the use of hESCs in cell-replacement therapy for severe uterine damage in future.