In orthopaedic surgery, autograft, most commonly from iliac crest, has long been the gold standard for bony augmentation for the treatment of skeletal fractures and fusions. Clinically, bone allograft with mesenchymal stem cells is readily available, has no donor site morbidity and has been shown to be non-immunogenic. Based on the current, albeit limited, literature, bone allograft with mesenchymal stem cells appears to be equal if not superior to autograft, thus making it an acceptable alternative in joint fusions and the treatment of nonunions and fractures with metabolic concerns or large defects. The aim of this critical review was to discuss the characteristics of bone allograft with mesenchymal stem cells and its clinical applicability. Conclusion Bone allograft with mesenchymal stem cells looks like a promising augmentation technology. It is as good, if not better, than autogenous graft material. We call for further studies to increase our understanding and improve our techniques.