Significance: Bronchopulmonary dysplasia (BPD), also known as chronic lung disease of infancy, is a major complication of preterm birth that, despite improvements in neonatal respiratory support and perinatal care, remains an important cause of morbidity and mortality, often with severe adverse neurodevelopmental sequelae. Even with major advances in our understanding of the pathogenesis of this disease, BPD remains essentially without adequate treatment. Recent Advances: Cell-based therapies arose as a promising treatment for acute and chronic lung injury in many experimental models of disease. Currently, more than 3000 human clinical trials employing cell therapy for the treatment of diverse diseases, including cardiac, neurologic, immune, and respiratory conditions, are ongoing or completed. Among the treatments, mesenchymal stem cells (MSCs) are the most studied and have been extensively tested in experimental models of BPD, pulmonary hypertension, pulmonary fibrosis, and acute lung injury. Critical Issues: Despite the promising potential, MSC therapy for human lung disease still remains at an experimental stage and optimal transplantation conditions need to be determined. Although the mechanism of MSC action can be manifold, accumulating evidence suggests a predominant paracrine, immunomodulatory, and cytoprotective effect. Future Directions: The current review summarizes the effect of MSC treatment in models of lung injury, including BPD, and focuses on the MSC secretome and, specifically, MSC-derived microvesicles as potential key mediators of therapeutic action that can be the focus of future therapies. Antioxid. Redox Signal. 21, 1905Signal. 21, -1915