Abstract: Acquired or congenital abnormalities may lead to urethral damage or loss, often requiring surgical reconstruction. Urethrocutaneous fistula and strictures are common complications, due to inadequate blood supply. Thus, adequate blood supply is a key factor for successful urethral tissue reconstruction. In this study, urethral grafts were prepared by seeding rabbit bladder urothelial cells (UCs) modified with human vascular endothelial growth factor (VEGF165) gene in the decellularized artery matrix. A retroviral pMSCV-VEGF165-GFP vector was cloned by insertion of VEGF open reading frame into the vector pMSCV-GFP (murine stem cell virus [MSCV]; green fluorescent protein [GFP]). Retrovirus was generated using package cell line 293T. Rabbit UCs were expanded ex vivo and modified with either MSCV-VEGF165-GFP or control MSCV-GFP retrovirus. Transduction efficiency was analyzed by fluorescence-activated cell sorting. The expression of VEGF165 was examined by immunofluorescence, reverse transcript-polymerase chain reaction, Western blot, and enzyme-linked immunosorbent assay (ELISA). Decellularized rabbit artery matrix was seeded with genetically modified UCs and was subsequently cultured for 1 week prior to subcutaneous implantation into nude mice. Four weeks after implantation, the implants were harvested and analyzed by fluorescence microscopy, and by histologic and immunohistochemical staining. Ex vivo transduction efficiency of UCs was greater than 50% when concentrated retrovirus was used. The modified cells expressed both VEGF and GFP protein. Furthermore, the VEGF-modified UCs secreted VEGF in a time-dependent manner. Scanning electron microscopy and histochemical analysis of cross sections of the cultured urethral grafts showed that the seeded cells were attached and proliferated on the luminal surface of the decellularized artery matrix. In the subcutaneously implanted vessels, VEGF-modified cells significantly enhanced neovascularization and the formation of a urethral layer compared to GFP-modified cells. These results indicate that VEGF gene therapy may be a suitable approach to increase the blood supply in tissue engineering for treatment of urethral damage or loss.