Replacing defective retinal pigment epithelial (RPE) cells with those derived from human embryonic stem cells (hESCs) or human-induced pluripotent stem cells (hiPSCs) is a potential strategy for treating retinal degenerative diseases. Early clinical trials have demonstrated that hESC-derived or hiPSC-derived RPE cells can be delivered safely as a suspension to the human eye. The next step is transplantation of hESC/hiPSC-derived RPE cells as cell sheets that are more physiological. We have developed a tissue-engineered product consisting of hESC-derived RPE cells grown as sheets on human amniotic membrane as a biocompatible substrate. We established a surgical approach to engraft this tissue-engineered product into the subretinal space of the eyes of rats with photoreceptor cell loss. We show that transplantation of the hESC-RPE cell sheets grown on a human amniotic membrane scaffold resulted in rescue of photoreceptor cell death and improved visual acuity in rats with retinal degeneration compared to hESC-RPE cells injected as a cell suspension. These results suggest that tissue-engineered hESC-RPE cell sheets produced under good manufacturing practice conditions may be a useful approach for treating diseases of retinal degeneration.