Chronic and non-healing skin wounds are some of the most significant complications in patients with advanced diabetes. A contributing mechanism to this pathology is the non-enzymatic glycation of proteins due to hyperglycemia, leading to the formation of advanced glycation end products (AGEs). AGEs bind to the receptor for AGEs (RAGE), which triggers pro-inflammatory signals that may inhibit the proliferative phase of wound healing. Soluble forms of RAGE (sRAGE) may be used as a competitive inhibitor of AGE-mediated signaling; however, sRAGE is short-lived in the highly proteolytic wound environment. We developed a recombinant fusion protein containing the binding domain of RAGE (vRAGE) linked to elastin-like polypeptides (ELPs) that self-assembles into coacervates at around 30-31 °C. The coacervate size was concentration and temperature-dependent, ranging between 500 and 1600 nm. vRAGE-ELP reversed several AGE-mediated changes in cultured human umbilical vein endothelial cells, including a decrease in viable cell number, an increase in levels of reactive oxygen species (ROS), and an increased expression of the pro-inflammatory marker, intercellular adhesion molecule-1 (ICAM-1). vRAGE-ELP was stable in elastase in vitro for 7 days. When used in a single topical application on full-thickness excisional skin wounds in diabetic mice, wound closure was accelerated, with 90% and 100% wound closure on post-wounding days 28 and 35, respectively, compared to 62% and 85% on the same days in animals treated with vehicle control, consisting of ELP alone. This coacervate system topically delivering a competitive inhibitor of AGEs has potential for the treatment of diabetic wounds.