Background: Endothelial colony forming cells (ECFCs) may be useful therapeutically in conditions with poor blood supply, such as distal limb wounds in the horse. Encapsulation of ECFCs into injectable hydrogel microspheres may ensure cell survival and cell localization to improve neovascularization and healing. Autologous ECFCs were isolated from 6 horses, labeled with quantum nanodots (QD), and a subset were encapsulated in poly(ethylene) glycol fibrinogen microspheres (PEG-Fb MS). Full-thickness dermal wounds were created on each distal limb and injected with empty PEG-Fb MS, serum, ECFCs, or ECFCs encapsulated into PEG-Fb MS (ECFC/MS). Analysis included wound surface area (WSA), granulation tissue scoring (GS), thermography, collagen density staining, and immunohistochemical staining for endothelial and inflammatory cells. The purpose of this study was to track cell location and evaluate wound vascularization and inflammatory response after injection of ECFC/MS or naked ECFCs in equine distal limb wounds. Results: ECFCs were found near and within newly formed blood vessels up to 3 weeks after injection. ECFC and ECFC/MS groups had the greatest blood vessel quantity at week 1 in the wound periphery. Wounds treated with ECFCs and ECFC/MS had the lowest density of neutrophils and macrophages at week 4. There were no significant effects of ECFC or ECFC/MS treatment on other measured parameters. Conclusions: Injection of microsphere encapsulated ECFCs was practical for clinical use and well-tolerated. The positive ECFC treatment effects on blood vessel density and wound inflammation warrant further investigation.