Human mesenchymal stem cells (MSCs) are multipotential and are detected in bone marrow (BM), adipose tissue, placenta, and umbilical cord blood (UCB). In this study, we examined the ability of UCB-derived MSCs (UCB-MSCs) to support ex vivo expansion of hematopoietic stem/progenitor cells (HSPCs) from UCB and the engraftment of expanded HSPCs in NOD/SCID mice. The result showed that UCB-MSCs supported the proliferation and differentiation of CD34+ cells in vitro. The number of expanded total nucleated cells (TNCs) in MSC-based culture was twofold higher than cultures without MSC (control cultures). UCB-MSCs increased the expansion capabilities of CD34+ cells, long-term culture-initiating cells (LTC-ICs), granulocyte-macrophage colony-forming cells (GM-CFCs), and high proliferative potential colony-forming cells (HPP-CFCs) compared to control cultures. The expanded HSPCs were transplanted into lethally irradiated NOD/SCID mice to assess the effects of expanded cells on hematopoietic recovery. The number of white blood cells (WBCs) in the peripheral blood of mice transplanted with expanded cells from both the MSC-based and control cultures returned to pretreatment levels at day 25 posttransplant and then decreased. The WBC levels returned to pretreatment levels again at days 45-55 posttransplant. The level of human CD45+ cell engraftment in primary recipients transplanted with expanded cells from the MSC-based cultures was significantly higher than recipients transplanted with cells from the control cultures. Serial transplantation demonstrated that the expanded cells could establish long-term engraftment of hematopoietic cells. UCB-MSCs similar to those derived from adult bone marrow may provide novel targets for cellular and gene therapy.