Traumatic injury of the central nervous system results in formation of a collagenous basement membrane-rich fibrous scar in the lesion centre. Due to accumulation of numerous axon-growth inhibitory molecules the lesion scar is considered a major impediment for axon regeneration. Following transection of the dorsal corticospinal tract (CST) at thoracic level 8 in adult rats, transient suppression of collagenous scarring in the lesion zone by local application of a potent iron chelator and cyclic adenosine monophosphate resulted in the delay of fibrous scarring. Treated animals displayed long-distance growth of CST axons through the lesion area extending for up to 1.5–2 cm into the distal cord. In addition, the treatment showed a strong neuroprotective effect, rescuing cortical motoneurons projecting into the CST that normally die (30%) after thoracic axotomy. Further, anterogradely traced CST axons regenerated through both grey and white matter and developed terminal arborizations in grey matter regions. In contrast to controls, injured animals receiving treatment showed significant functional recovery in the open field, in the horizontal ladder and in CatWalk locomotor tasks. We conclude that the fibrous lesion scar plays a pivotal role as a growth barrier for regenerating axons in adult spinal cord and that a delay in fibrotic scarring by local inhibition of collagen biosynthesis and basement membrane deposition is a promising and unique therapeutic strategy for treating human spinal trauma.