Mesenchymal stem cells (MSCs), derived from adult bone marrow, are multi-potent stem cells capable of differentiating along several lineage pathways. From a small bone marrow aspirate, MSCs can be readily isolated and easily expanded. Therefore, MSCs are thought to be a readily available source of cells for many tissue engineering and regenerative medicine applications. This review covers preclinical models that evaluate the efficacy of MSC-loaded scaffolds in large bone defects as a potential substitute for autologous and allogeneic bone grafts. This review also covers new approaches to clinical use of MSC technology.