Multi-lineage progenitors, e.g. mesenchymal stem cells, persist in adult developed organs, making a windfall for the cell therapist but an enigma for stem cell biologists. Recent results from our own and other laboratories show that the ancestor of these elusive adult stem cells is likely to be found in the perivascular area, explaining the ubiquitous distribution of these cells in the body. We have prospectively identified and purified vascular pericytes in multiple human organs and shown that these cells are potent mesodermal progenitors that give rise to genuine mesenchymal stem cells in culture. Pericytes can differentiate into diverse cell lineages, but also secrete multiple paracrine growth factors/cytokines, which likely explains in part their robust regenerative potential.