It is estimated that 15% of the diabetic patients have non-healing foot ulcerations. Recent data show that healthy adult stem/progenitor cells improve the healing of diabetic chronic wounds. However, in autologous setting, the use of adult stem cells from diabetic patients raise some issues since the stem cells have impaired properties due to ageing and disease. Human umbilical cord blood (UCB) can be a potential source of healthy endothelial progenitor cells for the healing of chronic wounds in diabetic patients. In the present study, we investigated the use of UCB-derived CD34+cells to promote the healing of diabetic wounds when administered topically in a fibrin gel. To enhance the therapeutic effect of CD34+cells, they were co-cultured with CD34+- derived endothelial cells (ECS).Our results show that these ECS have higher angiogenic and prosurvival properties than typical differentiated ECS such as human umbilical vein endothelial cells (HUVECS).Cell survival and differentiation is improved by co-culturing CD34+cells with CD34+-derived ECS.Our results show that fibrin gels are permissive environments for CD34+cells attachment. Quantitative LIVE/DEAD and MTT analyses show a significant increase in cell viability and proliferation for CD34+cells co-cultured with CD34+-derived ECS (n=6, p<0.01 or p<0.001). In contrast, HUVECS did not affect the viability of CD34+cells (n=6, p>0.05), indicating that the pro-survival effect is specifically mediated by CD34+-derived ECS. Importantly, addition of CD34+-derived EC-conditioned medium to cell constructs formed by CD34+cells resulted in a significant increase in cell viability (n=6, p<0.001). Our results suggest that the pro-survival effect of CD34+-derived ECS on CD34+cells is mediated, at least in part, by bioactive factors released from the ECS, which activated ERK signalling pathway. We have identified IL-10 and IL-17 as important mediators in this process. Our results also show that CD34+cell differentiation into ECS is significantly improved in the presence of CD34+-derived ECS. Co-transplantation of CD34+cells with CD34+-derived ECS improved wound healing. Our results indicate that diabetic chronic wounds treated with a combination of both types of cells encapsulated in a fibrin gel have improved healing compared to wounds treated with gel containing only stem cells. We demonstrated that the co-culture system secreted factors, which increased neovascularization and decreased inflammatory reaction.