It is more than a decade that amniotic membrane has been used as a wound dressing because of its anti-inflammatory, anti-microbial, anti-fibrotic, anti-scarring properties, as well as its pain relieving and epithelialization promoting features. However, amniotic membrane had limited applications because it needs to suture in surgery, is highly fragile, firmly adhere to the wound and may cause bleeding and pain when changing the bandage. This study investigated the possibility of development of a novel amniotic-based chitosan gel dressing as a potential wound repair substrate with marked efficacy. In this experiment, amniotic gel prepared based on chitosan/PVP gel containing human amniotic membrane extract (AME-Gel) was investigated in terms of wound-healing efficacy and scar preventive effects in a rat burn model. The levels of re-epithelialization and dermal regeneration were examined by histological assessment using H&E and Masson's trichrome staining. Also, we clarified the mechanism of healing and cytokine-releasing activities of AME as well as its effect on epithelization, angiogenesis, and fibroblast growth and migration. Our results revealed that AME-Gel induces epidermal and dermal regeneration at a shorter time through formation of granulation tissue, enhancement of fibroblast proliferation, and improvement of blood capillary formation concomitant with developing collagen bundles. Therefore, AME-Gel could be considered a simple and easy to be used as a biological dressing for any type of superficial burn wounds, without any adverse effects.