Skin stem cells can regenerate epidermal appendages; however, hair follicles (HF) lost as a result of injury are barely regenerated. Here we show that macrophages in wounds activate HF stem cells, leading to telogen-anagen transition (TAT) around the wound and de novo HF regeneration, mostly through TNF signalling. Both TNF knockout and overexpression attenuate HF neogenesis in wounds, suggesting dose-dependent induction of HF neogenesis by TNF, which is consistent with TNF-induced AKT signalling in epidermal stem cells in vitro. TNF-induced β-catenin accumulation is dependent on AKT but not Wnt signalling. Inhibition of PI3K/AKT blocks depilation-induced HF TAT. Notably, Pten loss in Lgr5+ HF stem cells results in HF TAT independent of injury and promotes HF neogenesis after wounding. Thus, our results suggest that macrophage-TNF-induced AKT/β-catenin signalling in Lgr5+ HF stem cells has a crucial role in promoting HF cycling and neogenesis after wounding.