Self-assembling multidomain peptide (MDP) hydrogels have shown great promise as biomaterials for regenerative medicine. In this work, we explored three main areas to understand the inherent activity of these materials further and expand their biomedical applications. First, we developed a non-ionic self-assembling peptide hydrogel, in which assembly is controlled by balancing aggregation of the amphiphilic core and steric interactions within the peptide termini. From a series of neutral peptides containing helical oligo-hydroxyproline termini, we determined that five hydroxyproline residues in the N and C termini of the MDP provide the required solubility, aggregation, and nanofibrous structure to form a compliant injectable hydrogel. This non-ionic peptide hydrogel is biocompatible and easily degraded in vivo and retains cell viability and induces cell quiescence in vitro. Second, we evaluated how the chemical functionality and ionic charge of different MDP hydrogels impacted the overall host immune response. Using a subcutaneous injection model, we characterized the cellular infiltrate of four peptide hydrogels with similar structural and mechanical properties, but with different chemical functionalities and charge. Peptides bearing carboxylate groups evoke minimal inflammation and are quickly remodeled and degraded by tissue-resident macrophages. The lysine-based peptide hydrogel induces acute inflammatory responses that resolve over time. This immune response characterized by blood vessel formation, macrophage infiltration, and collagen deposition may be ideal for tissue regeneration applications. On the other hand, peptide hydrogel containing guanidinium ions causes higher inflammation with a constant presence of granulocytes, which could lead to chronic inflammation and fibrous encapsulation. The characterization of the host responses to these different peptide hydrogels serves as a valuable resource for the rational design of materials for biomedical applications. Lastly, we explored the efficacy of lysine-based peptide hydrogels to promote peripheral nerve regeneration after a crush injury. We developed several peptide candidates containing short peptide mimics from extracellular matrix proteins. We then evaluated the neurite outgrowth promoting activity of all peptide candidates in vitro and their capacity to promote recovery in a sciatic nerve crush injury model. MDP hydrogels were infiltrated by macrophages and degraded over time, and a few candidates accelerated nerve regeneration and functional recovery. This work demonstrates the versatility of the MDP design and biological responses, and the enormous potential of these biomaterials in tissue regeneration and wound healing.