Cutaneous leishmaniasis (CL) is a neglected tropical disease that causes prominent skin scaring. No water soluble, non-toxic, short course and low cost treatment exists. We developed a new water soluble amphotericin B-polymethacrylic acid (AmB-PMA) using established and scalable chemistries. AmB-PMA was stable for 9 months during storage. In vitro, it was effective against Leishmania spp. promastigotes and amastigote infected macrophages. It was also less toxic and more effective than deoxycholate-AmB, and similar to liposomal AmB. Its in vivo activity was determined in both early and established CL lesion models of Leishmania major infection in genetically susceptible non-healing BALB/c mice. Intradermal AmB-PMA at a total dose of 18 mg of AmB/kg body weight led to rapid parasite killing and lesion healing. No toxicity was seen. No parasite relapse occurred after 80 days follow-up. Histological studies confirmed rapid parasite clearance from macrophages followed by accelerated fibroblast mediated tissue repair, regeneration and cure of the infection. Quantitative mRNA studies of the CL lesions showed that accelerated healing was associated with increased Tumour Necrosis Factor-α and Interferon-γ, and reduced Interleukin-10. These results suggest that a cost-effective AmB-PMA could be used to pharmacologically treat and immuno-therapeutically accelerate the healing of CL lesions.