This study randomly assigns patients with diabetic foot ulcers to receive standard therapy (surgical debridement, saline-moistened gauze and offloading) alone or standard therapy plus Dermagraft(R). Dermagraft is a device containing live human fibroblasts grown on an absorbable Vicryl mesh. Patients are seen weekly until they heal or the 12-week treatment period is complete.

Inclusion Criteria:

• Patient is 18 years of age or older.
• Patient has type I or II diabetes.
• Foot ulcer has been present for a minimum of 2 weeks under the current investigator's care.
• Foot ulcer is on the plantar surface of the forefoot or heel.
• Ulcer size is >/=1.0 cm2 at Day 0 (day of randomization).
• Ulcer extends through the dermis and into subcutaneous tissue but without exposure of muscle, tendon, bone, or joint capsule.
• Ulcer is free of necrotic debris, exhibits no signs of clinical infection, and appears to be made up of healthy vascularized tissue.
• Patient's Ankle-Arm Index by Doppler is >/=0.7.
• Patient has adequate circulation to the foot as evidenced by a palpable pulse.
• Female patients of child bearing potential must not be pregnant and must use accepted means of birth control.
• Patient and caregiver are willing to participate in the clinical study and can comply with the follow-up regimen.
• Patient or his/her legal representative has read and signed the Institutional Review Board (IRB) approved Informed Consent form before treatment.
• Patient's study ulcer has been present (open) for at least 6 weeks at the time of the Screening visit.

Exclusion Criteria:

• There is clinical evidence of gangrene on any part of the affected foot.
• The study ulcer is over a Charcot deformity.
• The study ulcer is due to a nondiabetic etiology.
• The ulcer has tunnels or sinus tracts that cannot be completely debrided.
• The ulcer is >20 cm2 (longest dimension cannot be greater than 5 cm).
• The ulcer has increased or decreased in size by 50% or more during the screening period.
• Presence of medical condition(s) that in the Investigator's opinion makes the patient an inappropriate candidate for this study.
• Presence of a malignant disease not in remission for 5 years or more.
• Evidence of severe malnutrition, based on a serum albumin level <2.0.
• Presence of patient having known alcohol or drug abuse.
• A random blood sugar reading >/=450 mg/dL.
• Presence of urine ketones that are noted to be "Small, Moderate, or Large".
• Presence of a nonstudy ulcer on the study foot within 7.0 cm of the study ulcer at Day 0.
• Use of oral or parenteral corticosteroids, immunosuppressive or cytotoxic agents, Coumadin or heparin during the study.
• A history of bleeding disorder.
• Presence of Acquired Immunodeficiency Syndrome (AIDS) or Human Immunodeficiency Virus (HIV).
• Participation in another study involving treatment with an investigational product within the previous 30 days.
• Elective osseous procedures to the study foot within 30 days prior to the Screening visit.
• Previous treatment with Dermagraft®.
• Presence in study ulcer of cellulitis, osteomyelitis or other clinical evidence of infection.
• Presence of condition(s) that seriously compromise the patient's ability to complete this study.