Introduction: The Vascular Endothelial Growth Factor 165 (VEGF-165) demonstrates angiogenic and neurogenic activity. Experimental study was conducted to investigate the potential of VEGF to stimulate regeneration in sciatic nerves of diabetic rats following crush injury. Materials and Methods: 36 sciatic nerves were evaluated in Zucker diabetic fatty male rats (ZDF/Gmi-fa/fa). The potential of VEGF for improvement of the nerve regeneration was studied using local injection of Ad-VEGF 165 into the area of the crushed sciatic nerve. Crush injury was performed using our standardized model (60 seconds compression with 17.4 N force). Animals were divided into the three groups (n=6). Group I (negative control) received no treatment. In Group II (GFP control) potential for transfection with adenovirus was evaluated by subepineural injection of 0.3 ml solution containing 108 pfu of Ad-GFP. Animals from Group III (VEGF treatment) received injections containing 0.3 ml of 108 pfu of Ad-VEGF. Functional evaluation at 3, 6 and 12 weeks included: pin-prick test, toe-spread test and somatosensory evoked potential (SEP) analysis. Histomorphometric analysis of axon number, area and myelin thickness was performed at 6 and 12 weeks. Histoimmunostaining with monoclonal antibodies against VEGF and Neuropilin (Np-1) was performed 7 days after transfection. Results: SEP analysis showed a significant (p<0.05) prolongation of the N2 latencies in the crush control and crush+GFP when compared to the crush+VEGF: at 3 weeks (33.63ms and 32.32ms versus 27.59ms); at 6 weeks (31.23ms and 31.64ms versus 24.79ms); at 12 weeks (29.70ms and 32.01ms versus 26.14ms) respectively. Histomorphometric evaluation showed improved nerve architecture with statistically better (p<0.05) results in crush+VEGF group when compared to crush and crush+GFP: at 6 weeks: axon area (54.11µm² versus 41.02µm²; 31.95% improvement) , myelin thickness (2.75µm versus 1.87µm and 1.99µm; 47.00% and 37.75% improvement); at 12 weeks: axon area (129.55µm² versus 99.54µm² and 100.93µm²; 30.16% and 28.36% improvement), myelin thickness (3.75µm versus 3.06µm and 3.10µm; 22.47% and 21.48% improvement), respectively. Finally histoimmunostaing revealed higher level of Np-1 and VEGF expression in vasa nervorum and Schwann cells in VEGF treated group. Conclusion: Local Ad-VEGF administration improved nerve regeneration following crush injury in the sciatic nerves of diabetic rats. It was confirmed by SEP and histomorphometry analysis. Angiogenic and neurogenic mechanisms of VEGF action was proven by histoimmunostainig showing expression of Neuropilin and VEGF not only in endothelial cells of vasa nervorum but also in the Schwann cells.