A fundamental and unresolved question in regenerative biology is how tissues return to homeostasis after injury. Answering this question is essential for understanding the etiology of chronic disorders such as inflammatory bowel diseases and cancer1. We used the Drosophila midgut2 to investigate this and discovered that during regeneration a subpopulation of cholinergic3 neurons triggers Ca2+ currents among intestinal epithelial cells, the enterocytes, to promote return to homeostasis. We found that down-regulation of the conserved cholinergic enzyme Acetylcholinesterase4 in the gut epithelium enables acetylcholine from specific TNF/Egr5-sensing cholinergic neurons to activate nicotinic receptors in innervated enterocytes. This activation triggers high Ca2+ that spreads in the epithelium through Inx2/Inx7 gap junctions6, promoting enterocyte maturation followed by reduction of proliferation and inflammation. Disrupting this process causes chronic injury consisting of ion imbalance, Yki/Yap activation7, cell death and increase of inflammatory cytokines reminiscent of inflammatory bowel diseases8. Altogether, the conserved cholinergic pathway facilitates epithelial Ca2+ currents that heal the intestinal epithelium. Our findings demonstrate nerve- and bioelectric9-dependent intestinal regeneration and advance our current understanding of how a tissue returns to homeostasis after injury.