To treat a wound is to bring out the process of repair of the tissues in the manner most conducive to the present and future welfare of the patients. Better wound healing with minimal scar formation with least pain is the prime motto of every surgeon. The present experimental study was designed to observe the wound healing activity of an innovative compound formulation “Manjishthadi Ghrita” using excision, incision wound and dead space models in Wistar strain albino rats. The results of Manjishthadi Ghrita were compared with the results of untreated control group and results of betadine ointment, considered as positive control. Effect of wound healing activity was assessed by noting the contraction of wound size, days taken for complete healing, tensile strength assessment of the scar and histopathological examination of the granulation tissue as well as incised skin area of the wound. Test drug application did not affect the complete days taken for complete healing, tensile strength of incised skin and collagen, ground substance formation in the granulation tissue and angiogenesis to significant extent. The present study demonstrates that local application of Manjishthadi ghrita did not having significant wound healing activity in experimental animals.