Thrombus formation and eventual intimal hyperplasia are the leading causes of small-diameter synthetic vascular graft failure. To combat these issues, we have incorporated a diazeniumdiolate-modified nitric oxide (NO)-producing peptide into a polyurethane to improve the thromboresistance of this biocompatible polymer. NO production by polyurethane films occurred for approximately 2 months under physiological conditions, and mechanical properties of the material were suitable for vascular graft applications. Platelet adhesion to NO-releasing polyurethane was dramatically decreased compared to control polyurethane. Furthermore, endothelial cell growth was stimulated in the presence of the NO-releasing polyurethane, while smooth muscle cell growth was greatly inhibited. The ability of this bioactive material to inhibit platelet adhesion and smooth muscle cell proliferation while encouraging endothelialization suggests that this NO-generating polyurethane may be suitable as a candidate material for small-diameter vascular grafts.