Collagen peptides have been reported to display various bioactivities and high bioavailability. Recently, increasing evidence has revealed the excellent wound-healing activity of collagen peptides, but their molecular mechanisms remain incompletely elucidated. This review systematically evaluates the therapeutic efficacy of collagen peptides from diverse sources based on various wound models. Furthermore, the structure–activity relationships of collagen peptides and wound-healing mechanisms are discussed and summarized. Characterized by their low molecular weight and abundant imino acids, collagen peptides facilitate efficient absorption by the body to deliver nutrition throughout the wound-healing process. The specific mechanism of collagen peptide for wound healing is mainly through up-regulation of related cytokines and participation in the activation of relevant signaling pathways, such as TGF-β/Smad and PI3K/Akt/mTOR, which can promote cell proliferation, angiogenesis, collagen synthesis and deposition, re-epithelialization, and ECM remodeling, ultimately achieving the effect of wound healing. Collagen peptides can offer a potential therapeutic approach for treating incision and excision wounds, mucosal injuries, burn wounds, and pressure ulcers, improving the efficiency of wound healing by about 10%–30%. The present review contributes to understanding of the wound-healing potential of collagen peptides and the underlying molecular mechanisms.