Over the last few years, because of their self-renewal capacity and multilineage differentiation potency, mesenchymal stem cells (MSCs) have been thought to have important therapeutic potential. MSCs are considered to be effective in immune system by suppressing maturation of DC and the functions of T cells, B cells, and natural killer (NK) cells, by inducing regulatory T (Treg) cells. Although target cell-MSC interactions may play important role, the MSC-mediated immunosuppression also mainly acts through the secretion of soluble molecules and cytokines that are induced or upregulated following interactions with immune cells. The majority of data on the immunomodulation of MSCs are in vitro, although several studies have been in vivo. Various animal models such as mouse, baboon, and rat have been used to evaluate in vivo MSC immunoregulatory properties related to alloreactive immunity in SC and organ transplantations, autoimmunity, or tumor immunity. Clinical studies with MSC have aimed to demonstrate promising results in treating patients with cancer, reducing the incidence of GVHD after BM transplantation, improving and treating amyotrophic lateral sclerosis, Crohn's disease, metachromatic leukodystrophy, Hurler syndrome, rheumatoid arthritis, type 1 diabetes mellitus, lupus nephritis, and liver cirrhosis.