Corneal architecture is essential for vision and is greatly perturbed by the absence of tears due to the highly prevalent disorder dry eye. With no regenerative therapies available, pathological alterations of the ocular surface in response to dryness, including persistent epithelial defects and poor wound healing, result in lifelong morbidity. Here, using a mouse model of aqueous-deficient dry eye, we reveal that topical application of the synthetic tear protein lacripep reverses the pathological outcomes of dry eye through restoring the extensive network of corneal nerves that are essential for tear secretion, barrier function, epithelial homeostasis and wound healing. Intriguingly, the restorative effects of lacripep occur despite extensive immune cell infiltration, suggesting tissue reinnervation and regeneration can be achieved under chronic inflammatory conditions. In summary, our data highlight lacripep as a first-in-class regenerative therapy for returning the cornea to a near homeostatic state in individuals who suffer from dry eye.