The prevalence of type 2 diabetes mellitus (T2DM), which leads to diabetic complications, has been increasing worldwide. The possible applications of T2DM-derived stem cells in cell therapy are limited because their characteristics are still not fully understood. In this study, we characterized adipose tissue-derived mesenchymal stem cells (AT-MSCs) from diabetic patients (dAT-MSCs) and found that insulin receptor substrate-1 (IRS-1) was highly phosphorylated at serine 636/639 in dAT-MSCs. Moreover, we found that early growth response factor-1 (EGR-1) and its target genes of PTEN and GGPS1 were highly expressed in dAT-MSCs in comparison to healthy donor-derived AT-MSCs (nAT-MSCs). We observed impaired wound healing after the injection of dAT-MSCs in the ischemic flap mouse model. The expressions of EGR-1 and its target genes were diminished by small hairpin RNA-targeted EGR-1 (shEGR-1) and treatment with a mitogen-activated protein kinase/extracellular signal-regulated kinase (MAPK/ERK) inhibitor (PD98059). Importantly, dAT-MSCs with shEGR-1 were able to restore the wound healing ability in the mouse model. Interestingly, under hypoxic conditions, hypoxia-inducible factor-1α (HIF-1α) can bind to the EGR-1 promoter in dAT-MSCs, but not in nAT-MSCs. Together, these results demonstrate that the expression of EGR-1 was upregulated in dAT-MSCs through two pathways: the main regulatory pathway is the MAPK/ERK pathway, the other is mediated by HIF-1α through direct transcriptional activation at the promoter region of the EGR1 gene. Our study suggests that dAT-MSCs may contribute to microvascular damage and delay wound healing through the overexpression of EGR-1. Interrupting the expression of EGR-1 in dAT-MSCs may be a useful treatment for chronic wounds in diabetic patients.