A novel chitosan composite hydrogel by combining functionalized graphene oxide (CGO) is fabricated. The introduction of CGO significantly improves the mechanical property of CS hydrogel owing to the enhanced interaction between chitosan and CGO sheets. In comparison to the CS-GO composite hydrogel, the compressive stress of the CS-CGO composite hydrogel increases from 1.9 MPa at strain of 70.4% to 4.2 MPa at strain of 78.4%, the tensile stress and strain improve from 141.2 kPa and 134.6% to 300.2 kPa and 165.9%, respectively. An interconnected porous structure is formed in the CS-CGO composite hydrogel and the pore size decreases as the CGO loading increases, which is desirable in improving its mechanical property. Furthermore, the cytotoxicity tests indicate that the CS-CGO composite hydrogel possesses an excellent biocompatibility and can promote the adhesion and proliferation of fibroblasts. In vivo evaluation on full-thickness excision wounds in experimental rat shows that the CS-CGO composite hydrogel significantly accelerates wound healing, and the wound closure rate reaches up to 92.2% after 21 days. A feasible strategy to fabricate an enhanced chitosan composite hydrogel for application in wound healing is offered.