The tremendous ability of the skin epidermis to regenerate is due to the presence of epidermal stem cells that continuously produce keratinocytes which undergo terminal differentiation to a keratinized layer that provides the skin’s barrier properties. The ability to control this process in vitro has made it possible to develop various types of tissue engineered skin grafts, some of which being among the first tissue engineered products to ever reach the marketplace. In the past 30 years these products have been applied with some success to the treatment of chronic skin wounds, such as diabetic and venous ulcers, as well as deep acute wounds, such as burns. Current technologies remain partially effective in their ability to restore other skin structures, for example the dermis, which is critical to the overall long-term appearance and function of the skin. Furthermore, to this day none of these approaches regenerate skin appendages (e.g. hair follicles, sweat glands). The use of earlier progenitor and stem cells, including embryonic stem cells is gaining interest to overcome such limitations. Furthermore, recent evidence suggests that “adult” stem cells, which are present in the circulation of the patient, home into areas of injury and likely participate in the wound healing process. In this paper, we start with an overview of the wound healing process and current methods used for wound treatment, both conventional and tissue engineered-based. We then review current research on the various types of stem cells used for skin tissue engineering and wound healing, and provide future directions.