BACKGROUND: Centella asiatica (L.) is a plant with neuroprotective and neuroregenerative properties; however, its effects on the neurodifferentiation of mesenchymal stem cells (MSCs) and on peripheral nerve injury are poorly explored. This study aimed to investigate the effects of C. asiatica (L.)-neurodifferentiated MSCs on the regeneration of peripheral nerve in a critical-size defect animal model. METHODS: Nerve conduit was developed using decellularised artery seeded with C. asiatica-neurodifferentiated MSCs (ndMSCs). A 1.5 cm sciatic nerve injury in Sprague–Dawley rat was bridged with reversed autograft (RA) (n = 3, the gold standard treatment), MSC-seeded conduit (MC) (n = 4) or ndMSC-seeded conduit (NC) (n> = 4). Pinch test and nerve conduction study were performed every 2 weeks for a total of 12 weeks. At the 12th week, the conduits were examined by histology and transmission electron microscopy. RESULTS: NC implantation improved the rats’ sensory sensitivity in a similar manner to RA. At the 12th week, nerve conduction velocity was the highest in NC compared with that of RA and MC. Axonal regeneration was enhanced in NC and RA as shown by the expression of myelin basic protein (MBP). The average number of myelinated axons was significantly higher in NC than in MC but significantly lower than in RA. The myelin sheath thickness was higher in NC than in MC but lower than in RA. CONCLUSION NC showed promising effects on nerve regeneration and functional restoration similar to those of RA. These findings revealed the neuroregenerative properties of C. asiatica and its potential as an alternative strategy for the treatment of critical size nerve defect.