Tissues in multicellular organisms are immensely diverse: animal tissues include sheet-like epithelia, bundles of syncitial muscle fibres and the branched and interconnected nerves, while plants contain sheet-like epidermis and highly organized bundles of vascular tissue. However, at the microanatomical level, tissues are notably similar in that they are organized into distinct domains: domains are characterized by their cellular compositions and hold precise adjacency relations among each other. These morphological similarities are surprising because multicellularity has evolved multiple times independently. Separately, tissues also hold a remarkable functional similarity: across all multicellular organisms, including poor regenerators such as mammals, tissues routinely heal from injuries. The cellular organization within tissues, as well as the ability regenerate result from developmental processes: cells divide, die, differentiate and migrate according to cues they receive from their neighborhoods.We ask two interlinked questions: What diversity of tissue morphology can simple developmental processes generate? And is tissue morphology related to tissue regeneration? We address these questions using an agent based model of cell-fate decisions where cells use simple rules to respond to their cellular neighborhoodsOur model produces a rich diversity of tissue morphologies: By simply tuning the density of cellular interactions and the propensity of cellular differentiation, we produce tissues that go from disordered and sparse to tissues organized into dense and contiguous domains. Importantly, tissue morphology was strongly linked to regeneration in the model: the ability to heal was highly enriched in densely packed, contiguous tissues. Moreover, the predominant mode of tissue healing in the model recapitulates natural mechanisms: tissues healed through the replacement of injured cells through cell-division in adjacent regions. Our work generates experimentally testable predictions on the effects of manipulating cellular interactions on tissue morphology and in turn, on tissue regeneration.