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Chronic diabetic wounds are difficult to heal due to impaired neovascularization, dysregulated tissue repair, and prolonged inflammation. To address these challenges, PLA/nanoclay/Nd₂O₃ nanocomposite fiber mats were fabricated by electrospinning. Structural and morphological analyses confirmed successful incorporation and uniform dispersion of nanoclay and Nd₂O₃ within the PLA matrix. Nanoclay modulated the scaffold surface, while Nd₂O₃ enhanced mechanical strength. The intercalated nanoclay network further improved load transfer, reduced fiber diameter, and enhanced surface wettability, supporting cellular interactions. The scaffold showed more than 90% cell viability across all tested samples, demonstrating good cytocompatibility. The optimized scaffold exhibited significant antibacterial activity against methicillin-resistant Staphylococcus aureus (MRSA). The enhanced vascular density of the scaffolds in the chick chorioallantoic membrane (CAM) assay confirms their angiogenic potential. The scaffold also demonstrated controlled degradation, with 8.1 ± 0.5% weight loss after 28 days in simulated body fluid. In vivo evaluation using a diabetic rat wound model showed accelerated wound contraction, complete reepithelialization, neovascularization and minimal inflammatory response by day 21. The findings of this study suggest that PLA/Clay/Nd₂O₃ bioactive nanofibrous scaffolds have considerable potential for diabetic wound-healing applications.