The generation of functional vascular networks has the potential to improve treatment for vascular diseases and to facilitate successful organ transplantation. Endothelial colony-forming cells (ECFCs) have robust proliferative potential and can form vascular networks in vivo. ECFCs are recruited from a bone marrow niche to the site of vascularization, where cues from the extracellular matrix instigate vascular morphogenesis. Although this process has been elucidated using natural matrix, little is known about vascular morphogenesis by ECFCs in synthetic matrix, a xeno-free scaffold that can provide a more controllable and clinically relevant alternative for regenerative medicine. We sought to study hyaluronic acid (HA) hydrogels as three-dimensional scaffolds for capillary-like structure formation from ECFCs, and to determine the crucial parameters needed to design such synthetic scaffolds. We found that ECFCs express HA-specific receptors and that vascular endothelial growth factor stimulates hyaluronidase expression in ECFCs. Using a well-defined and controllable three-dimensional HA culture system, we were able to decouple the effect of matrix viscoelasticity from changes in adhesion peptide density. We determined that decreasing matrix viscoelasticity, which corresponds to a loose ultrastructure, significantly increases ECFC vascular tube length and area, and that the effect of local delivery of vascular endothelial growth factor within the hydrogel depends on the makeup of the synthetic environment. Collectively, these results set forth initial design criteria that need to be considered in developing vascularized tissue constructs.