We developed a tissue-engineered vascular graft composed of biodegradable scaffold seeded with autologous bone marrow-derived mononuclear cells (BMMCs) that is currently in clinical trial and developed analogous mouse models to study mechanisms of neovessel formation. We previously reported that seeded human BMMCs were rapidly lost after implantation into immunodeficient mice as host macrophages invaded the graft. As a consequence, the resulting neovessel was entirely of host cell origin. Here, we investigate the source of neotissue cells in syngeneic BMMC-seeded grafts, implanted into immunocompetent mouse recipients. We again find that seeded BMMCs are lost, declining to 0.02% at 14 d, concomitant with host macrophage invasion. In addition, we demonstrate using sex-mismatched chimeric hosts that bone marrow is not a significant source of endothelial or smooth muscle cells that comprise the neovessel. Furthermore, using composite grafts formed from seeded scaffold anastomosed to sex-mismatched natural vessel segments, we demonstrate that the adjacent vessel wall is the principal source of these endothelial and smooth muscle cells, forming 93% of proximal neotissue. These findings have important implications regarding fundamental mechanisms underlying neotissue formation; in this setting, the tissue-engineered construct functions by mobilizing the body's innate healing capabilities to "regenerate" neotissue from preexisting committed tissue cells.