To date, it has repeatedly been demonstrated that infusing bone marrow-derived stem cells (BMSCs) into acellular nerve scaffolds can promote and support axon regeneration through a peripheral nerve defect. However, harvesting BMSCs is an invasive and painful process fraught with a low cellular yield. In pursuit of alternative stem cell sources, we isolated stem cells from the inguinal subcutaneous adipose tissue of adult Sprague-Dawley rats (adipose-derived stem cells, ADSCs). We used a co-culture system that allows isolated adult mesenchymal stem cells (MSCs) and Schwann cells (SCs) to grow in the same culture medium but without direct cellular contact. We verified SC phenotype in vitro by cell marker analysis and used red fluorescent protein-tagged ADSCs to detect their fate after being injected into a chemically extracted acellular nerve allograft (CEANA). To compare the regenerative effects of CEANA containing either BMSCs or ADSCs with an autograft and CEANA only on the sciatic nerve defect in vivo, we performed histological and functional assessments up to 16 weeks after grafting. In vitro, we observed reciprocal beneficial effects of ADSCs and SCs in the ADSC-SC co-culture system. Moreover, ADSCs were able to survive in CEANA for 5 days after in vitro implantation. Sixteen weeks after grafting, all results consistently showed that CEANA infused with BMSCs or ADSCs enhanced injured sciatic nerve repair compared to the acellular CEANA-only treatment. Furthermore, their beneficial effects on sciatic injury regeneration were comparable as histological and functional parameters evaluated showed no statistically significant differences. However, the autograft group was roundly superior to both the BMSC- or ADSC-loaded CEANA groups. The results of the present study show that ADSCs are a viable alternative stem cell source for treating sciatic nerve injury in lieu of BMSCs.