Impaired wound healing is a common complication for diabetic patients and effective diabetic wound management remains a clinical challenge. Furthermore, a significant problem that contributes to patient morbidity is the suboptimal quality of healed skin, which often leads to reoccurring chronic skin wounds. Herein, a novel compound and biomaterial building block, panthenol citrate (PC), is developed. It has interesting fluorescence and absorbance properties, and it is shown that PC can be used in soluble form as a wash solution and as a hydrogel dressing to address impaired wound healing in diabetes. PC exhibits antioxidant, antibacterial, anti‐inflammatory, and pro‐angiogenic properties, and promotes keratinocyte and dermal fibroblast migration and proliferation. When applied in a splinted excisional wound diabetic rodent model, PC improves re‐epithelialization, granulation tissue formation, and neovascularization. It also reduces inflammation and oxidative stress in the wound environment. Most importantly, it improves the regenerated tissue quality with enhanced mechanical strength and electrical properties. Therefore, PC could potentially improve wound care management for diabetic patients and play a beneficial role in other tissue regeneration applications.