It has recently been recognized that mesenchymal stem cells (MSCs) isolated from adult bone marrow are able to modify the alloimmune response in vitro and in vivo. MSCs can be expanded into large quantities in culture, thereby facilitating potential future applications in solid organ transplantation. To develop novel MSC-based antirejection treatments, the mechanism behind the immunomodulatory ability of MSCs has to be elucidated further. At present, a variety of possible in vitro effects of MSCs on immune system effector cells have been reported, but little is known about their in vivo properties. Here, we discuss recent findings regarding the influence of MSCs on different effector cell populations in vitro and summarize the available data describing their in vivo properties.