Bone marrow-derived multipotent stromal cells (BMMSCs) represent an attractive therapeutic modality for cell therapy in type 2 diabetes mellitus (T2DM)-associated complications. T2DM changes the bone marrow environment; however, its effects on BMMSC properties remain unclear. The present study aimed at investigating select functions and differentiation of BMMSCs harvested from the T2DM microenvironment as potential candidates for regenerative medicine. BMMSCs were obtained from Zucker diabetic fatty (ZDF; an obese-T2DM model) rats and their lean littermates (ZL; controls), and cultured under normoglycemic conditions. The BMMSCs derived from ZDF animals were fewer in number, with limited clonogenicity (by 2-fold), adhesion (by 2.9-fold), proliferation (by 50%), migration capability (by 25%), and increased apoptosis rate (by 2.5-fold) compared to their ZL counterparts. Compared to the cultured ZL-BMMSCs, the ZDF-BMMSCs exhibited (i) enhanced adipogenic differentiation (increased number of lipid droplets by 2-fold; upregulation of the Pparg, AdipoQ, and Fabp genes), possibly due to having been primed to undergo such differentiation in vivo prior to cell isolation, and (ii) different angiogenesis-related gene expression in vitro and decreased proangiogenic potential after transplantation in nude mice. These results provided evidence that the T2DM environment impairs BMMSC expansion and select functions pertinent to their efficacy when used in autologous cell therapies.