Although cystic fibrosis at first sight appears to be one of the most obvious human diseases to treat with gene therapy, since it is caused by a single-gene defect and the main affected organ is the lung which is relatively easily accessible, clinical results have thus far been disappointingly limited. At least one cause for this lack of success is the failure to permanently correct the gene defect in addition to the rapid turnover of lung epithelial cells. Alternative approaches therefore involve the search for and use of stem cell populations. This review presents an overview of recent attempts to identify lung- or bone marrow-derived populations of stem cells or progenitor cells and to apply such cells, heterologous or gene-corrected autologous, to colonize the airways while differentiating into functional respiratory columnar epithelial cells. The most successful approaches thus far appear to be obtained with bone marrow-derived cells such as mesenchymal stem cells, although the transdifferentiation rate thus far has been limited to below the 1% level. As an alternative the proven multipotent nature of bronchioalveolar stem cells isolated from lung tissue may provide another promising approach for successful stem cell therapy.