In order to develop a better wound-dressing to enhance diabetic wound healing, we have examined the biochemical and biophysical features of chitosan-crosslinked collagen sponge (CCCS) and pre-clinically evaluated the CCCS containing recombinant human acidic fibroblast growth factor (CCCS/FGF) in accelerating diabetic wound healing as compared to collagen sponge alone and FGF alone. Collagen crosslinked with chitosan showed several advantages required for wound dressing, including the uniform and porous ultrastructure, less water-imbibition, small interval porosity, high resistance to collagenase digestion and slow release of FGF from CCCS/FGF. Therapeutic effect of the new wound-dressing containing FGF (i.e.: CCCS/FGF) on diabetic wound healing was examined in type 1 diabetic rat model in which hyperglycemia was induced by single dose of streptozotocin (STZ) and persisted for two months. The CCCS/FGF provided the most efficiently therapeutic effect among various treatments, showing the shortest healing time (14 days in the CCCS/FGF-treated group as compared to 18~21 days in other treatment groups), the quickest tissue collagen generation, the earliest and highest TGF-beta1 expression and dermal cell proliferation (PCNA expression). All these results suggest that CCCS/FGF is an ideal wound-dressing to improve the recovery of healing-impaired wound such as diabetic skin wound, which provides a great potential use in clinics for diabetic patients in the future.