Skeletal muscle has an extraordinary regenerative capacity reflecting the rapid activation and effective differentiation of muscle stem cells (MuSCs). In the course of muscle regeneration, MuSCs are reprogrammed by immune cells. In turn, MuSCs confer immune cells anti-inflammatory properties to resolve inflammation and facilitate tissue repair. Indeed, MuSCs can exert therapeutic effects on various degenerative and inflammatory disorders based on their immunoregulatory ability, including effects primed by interferon-γ (IFN-γ) and tumor necrosis factor-α (TNF-α). At the molecular level, the tryptophan metabolites, kynurenine or kynurenic acid, produced by indoleamine 2,3-dioxygenase (IDO), augment the expression of TNF-stimulated gene 6 (TSG6) through the activation of the aryl hydrocarbon receptor (AHR). In addition, insulin growth factor 2 (IGF2) produced by MuSCs can endow maturing macrophages oxidative phosphorylation (OXPHOS)-dependent anti-inflammatory functions. Herein, we summarize the current understanding of the immunomodulatory characteristics of MuSCs and the issues related to their potential applications in pathological conditions, including COVID-19.