Formation of glial scars physically impedes growth of regenerating axons following CNS injuries such as spinal cord trauma. Glial scars also produce various species of chondroitin sulfate proteoglycans (CSPGs) that act as a potent inhibitor of axon growth. Thus, inhibition of glial scar formation and/or suppression of CSPGs production may support axonal regeneration following spinal cord injury. Hepatocyte growth factor (HGF), which was originally identified as a mitogen for hepatocytes, has been shown to strongly suppress fibrosis of internal organs such as liver and kidney. However, its role in the regulation of CNS glial scars has not been studied. The purpose of this study was to examine whether HGF can affect formation of glial scars and production of various CSPGs. Glial scar formation was mimicked in vitro by cytokine treatment in primary astrocyte culture. Treatment of TGFβ1 led to astrocytic hypertrophy that was associated with dramatic upregulation of intermediate filament, GFAP (glial fibrillary acidic protein), which was evidently suppressed by HGF cotreatment in a dose-dependent manner. HGF also inhibited TGFβ1-induced upregulation of neurocan, one of CSPG species. To explore whether glial scar formation is inhibited by HGF in vivo spinal cord injury model, HGF overexpressing mesenchymal stem cells (HGF-MSCs) were transplanted into hemisected spinal cord lesions at T8. The ex-vivo gene delivery approach effectively increased the HGF level and phosphorylation of its cognate receptor c-Met. Transplantation of HGF-MSCs reduced the formation glial scar and CSPGs deposition around the hemisection lesions. Western blot showed that the amount of neurocan significantly decreased in animals with HGF-MSCs transplantation. These findings were accompanied by decreases in TGFβ1 and β2, strong inducers of astrocyte activation. Our results suggest that HGF may potently regulate both glial scar formation and CSPGs production following spinal cord injury