Repair or regeneration of damaged nerves is still a challenging clinical task in reconstructive surgeries and regenerative medicine. Here, it is demonstrated that periodontal ligament stem cells (PDLSCs) and gingival mesenchymal stem cells (GMSCs) isolated from adult human periodontal and gingival tissues assume neuronal phenotype in vitro and in vivo via a subcutaneous transplantation model in nude mice. PDLSCs and GMSCs are encapsulated in a 3D scaffold based on alginate and hyaluronic acid hydrogels capable of sustained release of human nerve growth factor (NGF). The elasticity of the hydrogels affects the proliferation and differentiation of encapsulated MSCs within scaffolds. Moreover, it is observed that PDLSCs and GMSCs are stained positive for βIII-tubulin, while exhibiting high levels of gene expression related to neurogenic differentiation (βIII-tubulin and glial fibrillary acidic protein) via quantitative polymerase chain reaction (qPCR). Western blot analysis shows the importance of elasticity of the matrix and the presence of NGF in the neurogenic differentiation of encapsulated MSCs. In vivo, immunofluorescence staining for neurogenic specific protein markers confirms islands of dense positively stained structures inside transplanted hydrogels. As far as it is known, this study is the first demonstration of the application of PDLSCs and GMSCs as promising cell therapy candidates for nerve regeneration.