Red ginseng and its active ingredients have been shown to decrease neuron death after brain ischemia in experimental animals. However, little is known about the effects of orally administered ginseng extract on spinal cord injury. We orally gave red ginseng extract (RGE) to rats with compressed spinal cord injury (SCI). Open-field locomotor scores were measured as indices of motor function. Histopathological changes and cytokine expressions in situ after SCI were evaluated. Compared to vehicle treatment, RGE treatment (350 mg/kg/day) significantly improved locomotor score up to levels close to those pre-SCI, prevented neuron loss, and facilitated the restoration of white matter in the spinal cord at 14 days after SCI. Treatment with RGE caused less aggregation of Iba-1-positive microglia in grey and white matter at 7 days after SCI, upregulated the expression levels of VEGF and Bcl-xL, and reduced IL-1β and TNFα expressions in the spinal cord at 7 and 14 days after SCI. We concluded that oral administration of RGE facilitates almost complete functional recovery from motor and behavioral abnormalities in rats with SCI and prevents neuron death in situ, possibly through inhibition of inflammation and upregulation of neuroprotective factors in the injured spinal cord.