Tissue-engineered vascular graft for the reconstruction of small arteries is still an unmet clinical need, despite the fact that a number of promising prototypes have entered preclinical development. Here we test Poly(3-hydroxybutyrate-co-3-hydroxyvalerate)Poly(ε-caprolactone) 4-mm-diameter vascular grafts equipped with vascular endothelial growth factor (VEGF), basic fibroblast growth factor (bFGF) and stromal cell-derived factor 1α (SDF-1α) and surface coated with heparin and iloprost (PHBV/PCL[VEGF-bFGF-SDF]Hep/Ilo, n = 8) in a sheep carotid artery interposition model, using biostable vascular prostheses of expanded poly(tetrafluoroethylene) (ePTFE, n = 5) as a control. Primary patency of PHBV/PCL[VEGF-bFGF-SDF]Hep/Ilo grafts was 62.5% (5/8) at 24 h postimplantation and 50% (4/8) at 18 months postimplantation, while all (5/5) ePTFE conduits were occluded within the 24 h after the surgery. At 18 months postimplantation, PHBV/PCL[VEGF-bFGF-SDF]Hep/Ilo grafts were completely resorbed and replaced by the vascular tissue. Regenerated arteries displayed a hierarchical three-layer structure similar to the native blood vessels, being fully endothelialised, highly vascularised and populated by vascular smooth muscle cells and macrophages. The most (4/5, 80%) of the regenerated arteries were free of calcifications but suffered from the aneurysmatic dilation. Therefore, biodegradable PHBV/PCL[VEGF-bFGF-SDF]Hep/Ilo grafts showed better short- and long-term results than bio-stable ePTFE analogues, although these scaffolds must be reinforced for the efficient prevention of aneurysms.