Biofunctionalization of artificial nerve implants by incorporation of specific bioactive factors has greatly enhanced the success of grafting procedures for peripheral nerve regeneration. However, most studies on novel biofunctionalized implants have emphasized the promotion of neuronal and axonal repair over vascularization, a process critical for long-term functional restoration. We constructed a dual-biofunctionalized chitosan/collagen composite scaffold with Ile-Lys-Val-Ala-Val (IKVAV) and vascular endothelial growth factor (VEGF) by combining solution blending, in situ lyophilization, and surface biomodification. Immobilization of VEGF and IKVAV on the scaffolds was confirmed both qualitatively by staining and quantitatively by ELISA. Various single- and dual-biofunctionalized scaffolds were compared for the promotion of endothelial cell (EC) and Schwann cell (SC) proliferation as well as the induction of angiogenic and neuroregeneration-associated genes by these cells in culture. The efficacy of these scaffolds for vascularization was evaluated by implantation in chicken embryos, while functional repair capacity in vivo was assessed in rats subjected to a 10 mm sciatic nerve injury. Dual-biofunctionalized scaffolds supported robust EC and SC proliferation and upregulated the expression levels of multiple genes and proteins related to neuroregeneration and vascularization. Dual-biofunctionalized scaffolds demonstrated superior vascularization induction in embryos and greater promotion of vascularization, myelination, and functional recovery in rats. These findings support the clinical potential of VEGF/IKVAV dual-biofunctionalized chitosan/collagen composite scaffolds for facilitating peripheral nerve regeneration, making it an attractive candidate for repairing critical nerve defect. The study may provide a critical experimental and theoretical basis for the development and design of new artificial nerve implants with excellent biological performance.