Bone marrow mesenchymal stem cells (BMSCs) have considerable therapeutic potential for the treatment of end-stage liver disease. Previous studies have demonstrated that BMSCs secrete growth factors and cytokines that inactivate hepatic stellate cells (HSCs), which inhibited the progression of hepatic fibrosis. The aim of this study was to determine the mechanism by which BMSCs suppress the function of HSCs in fibrosis. Our results showed that co-culture of BMSCs and HSCs induced cell cycle arrest at the G10/G1 phase and cell apoptosis of HSCs, which finally inhibited the cell proliferation of HSCs. Consistent with the cell cycle arrest, co-culture of BMSCs and HSCs increased the abundance of the cell cycle protein p27. Mechanistically, we further uncovered that following the co-culture with BMSCs, the expression level of the E3 ligase S-phase kinase-associated protein 2 (SKP2) that is responsible for the ubiquitination of p27 was decreased, which attenuated the ubiquitination of p27 and increased the stability of p27 in HSCs. Collectively, our results indicated the potential involvement of the SKP2–p27 axis for the inhibitory effect of BSMCs on the cell proliferation of HSCs.