Umbilical cord matrix stem (UCMS) cells are unique stem cells derived from Wharton's jelly, which have been shown to express genes characteristic of primitive stem cells. To test the safety of these cells, human UCMS cells were injected both intravenously and subcutaneously in large numbers into severe combined immunodeficiency (SCID) mice and multiple tissues were examined for evidence of tumor formation. UCMS cells did not form gross or histological teratomas up to 50 days posttransplantation. Next, to evaluate whether UCMS cells could selectively engraft in xenotransplanted tumors, MDA 231 cells were intravenously transplanted into SCID mice, followed by intravenous transplantation of UCMS cells 1 and 2 weeks later. UCMS cells were found near or within lung tumors but not in other tissues. Finally, UCMS cells were engineered to express human interferon beta--designated 'UCMS-IFN-beta'. UCMS-IFN-beta cells were intravenously transplanted at multiple intervals into SCID mice bearing MDA 231 tumors and their effect on tumors was examined. UCMS-IFN-beta cells significantly reduced MDA 231 tumor burden in SCID mouse lungs indicated by wet weight. These results clearly indicate safety and usability of UCMS cells in cancer gene therapy. Thus, UCMS cells can potentially be used for targeted delivery of cancer therapeutics.