Severe graft-versus-host disease (GVHD) and graft rejection still remain major complications of haploidentical nonmyeloablative (NMA) stem cell transplantation. Recent studies have shown that bone marrow-derived mesenchymal stem cells (MSCs) possess immunomodulatory capacity and may promote hematopoietic engraftment. The purpose of this study was to observe if the new strategy, which included a haploidentical peripheral blood stem cell transplantation (PBSCT) combined with MSCs, modified NMA conditioning, and GVHD prophylaxis would improve donor engraftment and prevent severe GVHD. The modified conditioning approach consisted of fludarabine (Flu), low-dose total body irradiation (TBI), cyclophosphamide (Cy), cytarabine, and anti-Tcell-lymphocyte globulin, whereas the GVHD prophylaxis consisted of cyclosporin A (CsA), mycophenolate mofetil (MMF), anti-CD25 antibody and intrabone marrow injection of MSCs. Thirty-three patients with high-risk acute leukemia underwent transplantation with PBSC from HLA-haploidentical donors without T cell depletion. All of the patients achieved full donor chimerisms, including 6 who switched to full donor chimerisms from mixed chimerisms in 1 to 2 months after the transplantations. Rapid hematological engraftment was observed with neutrophils >0.5 x 10(9)/L at day 11 and platelets >20 x 10(9)/L at day 14. Fifteen patients (45.5%) developed grade I-IV acute GVHD (aGVHD) and only 2 (6.1%) developed grade III to IV aGVHD. Nine (31%) of 29 evaluable patients experienced chronic GVHD (cGVHD). Upon follow-up for 1.5 to 60 months, 20 (60.6%) patients were alive and well and 6 (18.2%) had relapsed leukemia in the 33 patients. The probability of 3-year survival was 57.2%. The results indicate that this new strategy is effective in improving donor engraftment and preventing severe GVHD, which will provide a feasible option for the therapy of high-risk acute leukemia.