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Introduction The published clinical data assessing stem cell therapy for ischemic stroke (IS) are inconclusive. We conducted this comprehensive meta‐analysis to evaluate the efficacy and safety of stem cell therapy in the treatment of IS. Methods We searched electronic databases/search engines for studies comparing stem cell therapy to control in the treatment of IS from inception to June 2022. References were screened manually for eligibility. The relevant baseline data along with outcomes measured by modified Rankin scale (mRS), National Institutes of Health Stroke Scale (NIHSS), Barthel index (BI) and death were extracted and analyzed. Results We included 18 studies (12 randomized controlled trials (RCTs) and six non‐RCTs) comprising a total of 724 patients including 365 in the stem cells and 359 in the control group. Pooled results considering the last follow‐up point across 12 studies showed that stem cells significantly decreased mRS scores in relation to control (MD = ‐0.265, 95% CI [‐0.403 to ‐0.1269], P‐value = 0.00017). There was no publication bias (P = 0.4). The univariate meta‐regression demonstrated that route of administration, stem cell type, stroke type, and study design did not significantly contribute to the heterogeneity of the stem cells effect estimate (P >0.05). Additional analyses showed no significant differences in mRS scores between stem cells and control after seven days to three months (n = seven studies; MD = ‐0.039, 95% CI [‐0.22 to 0.15], P‐value = 0.681) and six to twelve months (n = ten studies; MD = ‐0.13, 95% CI [‐0.37 to 0.089], P‐value = 0.234). However, stem cells significantly decreased mRS scores in relation to control after two to four years (n = four studies; MD = ‐0.28, 95% CI [‐0.49 to ‐0.068], P‐value = 0.0096). Similarly, pooled results considering the last follow‐up point across nine studies showed that stem cells marginally decreased NIHSS scores in relation to control (MD = ‐1.185, 95% CI [‐2.37 to 0.00], P‐value = 0.05) with no publication bias (P = 0.5). Moreover, pooled results from 11 studies showed that stem cells significantly increased BI in relation to control (MD = 5.36, 95% CI [2.51 to 8.21], P‐value = 0.0002) with no publication bias (P = 0.675). Pooled results from 17 studies showed that stem cells treatment was significantly associated with lower risk of death in relation to control group (RR = 0.565, 95% CI [0.345 to 0.927], P‐value = 0.024). Conclusions Stem cell therapy for the treatment of IS seems to be associated with improved functional outcomes and reduced mortality. Notably, the demonstration of the functional outcome benefit appears to be more evident on longer follow‐up times (>2 years). Additional prospective studies are needed and should consider longer follow‐up periods.