Injuries that heal by fibrosis can compromise organ function and increase patient morbidity. The oral mucosal barrier has a high regenerative capacity with minimal scarring, but the cellular mechanisms remain elusive. Here, we identify distinct postnatal paired-related homeobox-1+ (Prx1+) cells as a critical fibroblast subpopulation that expedites mucosal healing by facilitating early immune response. Using transplantation and genetic ablation model in mice, we show that oral mucosa enriched with Prx1+ cells heals faster than those that lack Prx1+ cells. Lineage tracing and scRNA-seq reveal that Prx1+ fibroblasts exhibit progenitor signatures in physiologic and injured conditions. Mechanistically, Prx1+ progenitors accelerate wound healing by differentiating into immunomodulatory SCA1+ fibroblasts, which prime macrophage recruitment through CCL2 as a key part of pro-wound healing response. Furthermore, human Prx1+ fibroblasts share similar gene and spatial profiles compared to their murine counterpart. Thus, our data suggest that Prx1+ fibroblasts may provide a valuable source in regenerative procedures for the treatment of corneal wounds and enteropathic fibrosis. © 2022 Ko et al.