Tissue-engineered vascular scaffolds provide a promising solution for the replacement of diseased vascular structures. However, a major challenge lies in enhancing endothelialization, host cell ingrowth, and angiogenesis. In this study, we investigated the feasibility of developing a bio-tubular scaffold from human dermal fibroblasts (HDFs) and human umbilical vein endothelial cells (HUVEC) co-cultured on electrospun poly(L-lactide-co-epsilon-caprolactone) membranes to address these issues. Confluent layers of HDFs stimulated the organization of HUVECs into capillary-like networks in an indirect contact (two-dimensional) co-culture on membranes. Bio-tubular scaffolds fabricated from co-cultured membranes were either grown statically in vitro or implanted subcutaneously in severe combined immunodeficient mice for up to 4 weeks for biocompatibility evaluation and functional performance. In vitro examination of co-cultures on scaffolds showed collagen remodeling and an improvement in biomechanical properties up to day 14. Morphological analysis of in vitro grown bio-tubular scaffolds revealed good attachment and growth of both cell types. After one month, co-cultured scaffolds in vivo showed higher infiltration of host cells and collagen remodeling as compared to the HDF-seeded grafts. After 4 weeks, thin continuous layers of endothelial cells and smooth muscle cells were formed as shown by staining with an antibody specific for CD31and alpha-actin (alpha-SMA). On the contrary, HDF-seeded scaffolds remained free of alpha-SMA-positive cells at all time points, whereas few CD31(+) cells appeared after 4 weeks. Thus, co-cultured membranes provide a solution for enhancing endothelialization, tissue regeneration, and growth in bio-tubular scaffolds and may have broader applications in regenerative medicine.