Hypoxia is known to play important role during various cellular process, including regeneration. Regeneration is a complex process involving wound healing and tissue repair. We propose that hypoxia might mediate regeneration through angiogenesis involving angiogenic factors such as VEGF, VEGF-R2, NRP1a during the wound healing process. We have chosen Zebrafish model to study the role of hypoxia induced regeneration. Unlike mammals Zebrafish has the ability to regenerate. Hypoxic condition was mimicked using inorganic salt cobalt chloride to study caudal fin regeneration in adult Zebrafish. Intense blood vessel formation, with increased tail fin length experimented at various time points have been observed when adult zebrafish caudal fin partially amputated were exposed to 1% CoCl2. Regeneration is enhanced under hypoxia, with increased VEGF expression. To study the significance of VEGF signaling during wound healing and tissue regeneration, sunitinib well known inhibitor of VEGF receptor is used against CoCl2-induced caudal fin regeneration. Diminished fin length, lowering of blood vessel formation was documented using angioquant software, reduction in mRNA level of hypoxia inducible factors, VEGF and other pro-angiogenic genes such as VEGF,VEGF-R2, NRP1A, FGFR2, ANGPT1 were observed, while reduction in VEGF protein was demonstrated using western blot analysis. Genistein inhibitor of HIF-1α completely arrested regeneration, with suppression of VEGF highlighting the significance of hypoxia induced VEGF signaling during fin regeneration. Our results suggest that hypoxia through HIF-1α might lead to angiogenesis involving VEGF signaling during wound healing and this might throw light on therapeutic efficacy of cobalt chloride during regeneration.