Mucosal healing is critical to maintain and restore intestinal homeostasis in inflammation. Previous data provide evidence that glial cell line-derived neurotrophic factor (GDNF) restores epithelial integrity by largely undefined mechanisms. Here, we assessed the role of GDNF for mucosal healing. In dextran sodium sulphate (DSS)-induced colitis in mice application of GDNF enhanced recovery as revealed by reduced disease activity index and histological inflammation scores. In biopsy-based wounding experiments GDNF application in mice improved healing of the intestinal mucosa. GDNF-induced epithelial recovery was also evident in wound assays from intestinal organoids and Caco2 cells. These observations were accompanied by an increased number of Ki67-positive cells in vivo after GDNF treatment, which were present along elongated proliferative areas within the crypts. In addition, the intestinal stem cell marker and R-spondin receptor LGR5 was significantly upregulated following GDNF treatment in all experimental models. The effects of GDNF on cell proliferation, LGR5 and Ki67 upregulation were blocked using the RET-specific inhibitor BLU-667. Downstream of RET-phosphorylation, activation of Src kinase was involved to mediate GDNF effects. GDNF promotes intestinal wound healing by promoting cell proliferation. This is mediated by RET-dependent activation of Src kinase with consecutive LGR5 upregulation, indicating activation of the stem cell niche.