Natural hydrogels have been investigated for three‐dimensional tissue reconstruction and regeneration given their ability to emulate the structural complexity of multi‐component extracellular matrices (ECM). Hydrogels rich in ECM can be extracted and assembled from soft tissues, retain a composition specific to the tissue source, and stimulate vascularized tissue formation. However, poor mechanical properties and rapid degradation hinder their performance in regenerative applications. This study investigates the effect of glutaraldehyde (GA) crosslinking on the mechanical properties, biological activity, and degradation of dermis‐isolated ECM‐rich hydrogels. Compression tests indicated that hydrogel elastic moduli and yield stress values increased significantly with GA exposure time. Lyophilization was shown to decrease yield stress values with respect to non‐lyophilized gels. Crosslinked ECM, unlike non‐crosslinked gels, was resistant to pepsin degradationin vitro. In a rodent subcutaneous implant model, crosslinking for 0.5 hours or longer drastically slowed degradation relative to controls. Inflammation was low and mature vascularized granulation tissue was observed in all gels, with an increase in vessel density at 1 week in crosslinked gels relative to controls. These results support the potential use of dermis‐derived hydrogels as materials for tissue engineering applications and suggest that crosslinking can enhance mechanical properties and prolong hydrogel lifetime while promoting vascularized tissue formation. © 2013 Wiley Periodicals, Inc. J Biomed Mater Res Part A: 101A:2883–2895, 2013.