<p>Damage to either the central or peripheral nervous system can result in significant impairments of movement and sensation, with poor regeneration often resulting from complications such as nerve adhesion and fibrosis. Adipose-derived stem cells (ADSCs) have emerged as a promising therapeutic candidate in promoting nerve regeneration owing to their regenerative potential, abundance, ease of harvest, low immunogenicity, and anti-inflammatory properties. ADSCs, isolated from adipose tissue, can differentiate into neural lineages, secrete a broad spectrum of neurotrophic and anti-fibrotic factors, and thereby foster axonal sprouting, remyelination, and scar attenuation. Additionally, these cells have demonstrated efficacy in preventing nerve adhesion, a common complication of nerve injury that impedes functional recovery. This review explores the properties, advantages, and regenerative potential of ADSCs, highlighting their roles in promoting axonal regeneration, myelination, and reducing fibrosis. Preclinical studies and early clinical trials associated with the peripheral and central nervous system injuries have reported promising results in terms of functional recovery and reduced scar formation, but challenges remain in standardizing ADSC-based therapies and achieving full functional restoration. Future advancements in ADSC therapies may include optimized delivery systems, genetic modifications, and the integration of advanced biomaterials to enhance their regenerative capabilities.</p>