Our previous studies showed that nestin-expressing hair follicle-associated-pluripotent (HAP) stem cells, which reside in the bulge area of the hair follicle, could restore injured nerve and spinal cord and differentiate into cardiac muscle cells. Here we transplanted mouse green fluorescent protein (GFP)-expressing HAP stem-cell colonies enclosed on polyvinylidene fluoride membranes (PFM) into the severed thoracic spinal cord of nude mice. After seven weeks of implantation, we found the differentiation of HAP stem cells into neurons and glial cells. Our results also showed that PFM-captured GFP-expressing HAP stem-cell colonies assisted complete reattachment of the thoracic spinal cord. Furthermore, our quantitative motor function analysis with the Basso Mouse Scale for Locomotion (BMS) score demonstrated a significant improvement in the implanted mice compared to non-implanted mice with a severed spinal cord. Our study also showed that it is easy to obtain HAP stem cells, they do not develop teratomas, and do not loose differentiation ability when cryopreserved. Collectively our results suggest that HAP stem cells could be a better source compared to induced pluripotent stem cells (iPS) or embryonic stem (ES) cells for regenerative medicine, specifically for spinal cord repair.Keywords: Cardiac muscle cells; Differentiation; Glial cells; Human hair follicle; Nestin; Neurons; Spinal cord injury; Stem cells.