Retinal dystrophies (RD) are major causes of familial blindness and are characterized by progressive dysfunction of photoreceptor and/or retinal pigment epithelium (RPE) cells. In this study, we aimed to evaluate and compare the therapeutic effects of two pluripotent stem cell (PSC)-based therapies. We differentiated RPE from human embryonic stem cells (hESCs) or human-induced pluripotent stem cells (hiPSCs) and transplanted them into the subretinal space of the Royal College of Surgeons (RCS) rat. Once differentiated, cells from either source of PSC resembled mature RPE in their morphology and gene expression profile. Following transplantation, both hESC- and hiPSC-derived cells maintained the expression of specific RPE markers, lost their proliferative capacity, established tight junctions, and were able to perform phagocytosis of photoreceptor outer segments. Remarkably, grafted areas showed increased numbers of photoreceptor nuclei and outer segment disk membranes. Regardless of the cell source, human transplants protected retina from cell apoptosis, glial stress and accumulation of autofluorescence, and responded better to light stimuli. Altogether, our results show that hESC- and hiPSC-derived cells survived, migrated, integrated, and functioned as RPE in the RCS rat retina, providing preclinical evidence that either PSC source could be of potential benefit for treating RD.