Extracellular vesicles (EVs) are cell-secreted particles with broad potential to treat tissue injuries by delivering cargo to program target cells. However, improving the yield of functional EVs on a per cell basis remains challenging due to an incomplete understanding of how microenvironmental cues regulate EV secretion at the nanoscale. We show that mesenchymal stromal cells (MSCs) seeded on engineered hydrogels that mimic the elasticity of soft tissues with a lower integrin ligand density secrete ∼10-fold more EVs per cell than MSCs seeded on a rigid plastic substrate, without compromising their therapeutic activity or cargo to resolve acute lung injury in mice. Mechanistically, intracellular CD63 multivesicular bodies (MVBs) transport faster within MSCs on softer hydrogels, leading to an increased frequency of MVB fusion with the plasma membrane to secrete more EVs. Actin-related protein 2/3 complex but not myosin-II limits MVB transport and EV secretion from MSCs on hydrogels. The results provide a rational basis for biomaterial design to improve EV secretion while maintaining their functionality.