Methods for identifying trichogenic dermal cells, including dermal papilla cells and dermal sheath cells, capable of inducing hair follicle formation when injected into skin are provided. Biomarkers have been discovered that can be used to detect, identify, and distinguish trichogenic dermal cells, i.e., that are able to induce hair follicle formation, from non-trichogenic skin cells. Populations of enriched trichogenic dermal cells can be produced by selecting for and enriching for dermal cells that the disclosed biomarkers. These enriched trichogenic dermal can be used for inducing hair follicle formation.