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Many neurotrophic factors have been shown to promote neurite outgrowth by improving the microenvironment that is required for nerve regeneration. However, the delivery of these bioactive agents to the nerve injury site, as well as effective and local release, remains a challenging problem. We have developed a novel composite nerve conduit comprised of poly(lactic acid-caprolactone) (P(LLA-CL)) and nerve growth factor (NGF). This was developed from core-shell structured biodegradable nanofibers, which were fabricated by coaxial electrospinning of P(LLA-CL) for the shell and bovine serum albumin (BSA) or BSA/NGF for the core. In rats, gaps of 10-mm long sciatic nerves were bridged using an autograft, an empty P(LLA-CL) conduit, a NGF injection P(LLA-CL) conduit, a P(LLA-CL)/NGF composite conduit, respectively. Regenerated nerve fibers were harvested and morphological and functional evaluation of nerve regeneration was performed at 12 weeks postsurgery. Although partial biodegradation and small cracks in the conduits were observed, the conduit outlines remained intact for 12 weeks after surgery. Based on functional and histological observations, the number and arrangement of regenerated nerve fibers, myelination, and nerve function reconstruction was similar in the P(LLA-CL)/NGF conduit group to that of the nerve autograft group ( p > 0.05), but was significantly greater to the empty P(LLA-CL) and injection NGF P(LLA-CL) conduit groups (both p < 0.05). Therefore, the composite P(LLA-CL)/NGF conduit, which exhibited favorable mechanical properties and biocompatibility, could effectively promote sciatic nerve regeneration in rats. © 2010 Wiley Periodicals, Inc. J Biomed Mater Res Part A, 2010. [ABSTRACT FROM AUTHOR]