Every tissue has an extracellular matrix (ECM) with certain properties unique to it - the tissue 'niche' - that are necessary for normal function. A distinct specific population of quiescent keratocan-expressing keratocytes populate the corneal stroma during homeostasis to maintain corneal function. However, during wound healing, when there is alteration of the niche conditions, keratocytes undergo apoptosis, and activated corneal fibroblasts and myofibroblasts attempt to restore tissue integrity and function. It is unknown what the fate of activated and temporary fibroblasts and myofibroblasts is after the wound healing process has resolved. In this study, we used several strategies to elucidate the cellular dynamics of corneal wound healing and the fate of corneal fibroblasts. We injured the cornea of a novel mouse model that allows cell-lineage tracing, and we transplanted a cell suspension of in vitro-expanded corneal fibroblasts that could be tracked after being relocated into normal stroma. These transplanted fibroblasts regained expression of keratocan in vivo when relocated to a normal stromal niche. These findings suggest that transformed fibroblasts maintain plasticity and can be induced to a keratocyte phenotype once relocated to an ECM with normal signaling ECM.