The complete functional regeneration of periodontal tissues—specifically, the simultaneous reconstruction of alveolar bone, cementum, and periodontal ligament—represents a major challenge in oral regenerative medicine. Dental-derived mesenchymal stem cells (DMSCs) are regarded as ideal seed cells for achieving this goal due to their multi-lineage differentiation potential and immunomodulatory properties. As a cell carrier, hydrogels offer the key advantage of mimicking the extracellular matrix through precisely tunable physicochemical properties (e.g., matrix stiffness, topological structure, degradation kinetics), thereby constructing a mechanical and biochemical microenvironment that actively directs stem cell fate. This review summarizes the application and research progress of DMSC-laden hydrogels in periodontal tissue repair. We first analyze the material characteristics of different hydrogel systems, and then elaborate on the specific molecular mechanisms by which hydrogels regulate DMSCs’ differentiation through mechanical properties such as matrix stiffness: stiff hydrogels drive osteogenic differentiation by activating the integrin-focal adhesion kinase (FAK)-Akt/mechanistic target of rapamycin (mTOR) signaling axis; inducing cytoskeletal remodeling, and promoting dephosphorylation and nuclear translocation of Yes-associated protein (YAP)/transcriptional co-activator with PDZ-binding motif (TAZ) to initiate the transcription of osteogenesis-related genes; and stabilizing β-catenin and activating the Wnt/β-catenin signaling pathway, upregulating the expression of key osteogenic transcription factors including Runt-related transcription factor 2 (Runx2) and Osterix. Furthermore, as programmed controlled-release carriers for bioactive factors, hydrogels selectively activate Smad signaling subtypes—pro-osteogenic factors specifically activate the Smad1/5/8 pathway, whereas factors promoting periodontal ligament formation activate the Smad2/3 pathway—thereby achieving precise, directed differentiation of DMSCs toward osteogenic, cementogenic, or fibroblastic lineages. Current key scientific issues in this field include the dynamic adaptation of hydrogel properties during regeneration, stable control of the complex oral microenvironment (e.g., microbes, mechanical forces, inflammation), strategies for efficient directional differentiation of stem cells, and feasibility of clinical translation. Future research directions should focus on developing smart-responsive hydrogels, constructing personalized biomimetic scaffolds combined with three-dimensional bioprinting technology, and designing composite material systems with immunomodulatory functions, aiming ultimately to achieve integrated structural and functional regeneration of periodontal tissue.