Skin diseases are among the cohort of medical conditions in which spending has increased the most. Within this group, skin ulcers represent the largest economic burden and current treatment options for patients are often ineffective. Mesenchymal stem cells (MSCs) have been reported by many groups to aid wound healing. Therapeutic applications for mesenchymal stem cells are growing; however, the successful implementation of these therapies requires the development of appropriate MSC delivery systems. This CIRM award has yielded novel hydrogel delivery systems for mesenchymal stem cells that we wish to work towards commercialization. We have demonstrated that the hydrogel-encapsulated stem cells remain viable and that when delivered to wounds they aid in wound healing. We have also characterized the ability of our different hydrogel MSC delivery systems to induce gene transcription. Each hydrogel delivery system was designed to incorporate different small molecule attachment sites to allow MSC adherence to the 3D matrix. These MSC-binding interactions altered MSC gene expression in a reproducible fashion. We are hopeful that this research will lead to a product for delivering MSCs to patients for a variety of applications.