Photoreceptor degeneration due to retinitis pigmentosa (RP) is a primary cause of inherited retinal blindness. Photoreceptor cell-replacement may hold the potential for repair in a completely degenerate retina by reinstating light sensitive cells to form connections that relay information to downstream retinal layers. This study assessed the therapeutic potential of photoreceptor progenitors derived from human embryonic and induced pluripotent stem cells (ESCs and iPSCs) using a protocol that is suitable for future clinical trials. ESCs and iPSCs were cultured in four specific stages under defined conditions, resulting in generation of a near-homogeneous population of photoreceptor-like progenitors. Following transplantation into mice with end-stage retinal degeneration, these cells differentiated into photoreceptors and formed a cell layer connected with host retinal neurons. Visual function was partially restored in treated animals, as evidenced by two visual behavioral tests. Furthermore, the magnitude of functional improvement was positively correlated with the number of engrafted cells. Similar efficacy was observed using either ESCs or iPSCs as source material. These data validate the potential of human pluripotent stem cells for photoreceptor replacement therapies aimed at photoreceptor regeneration in retinal disease.