Mesenchymal Stromal Cells (MSCs) are fibroblast-like cells of mesodermal origin present in many tissues and which have the potential to differentiate to osteoblasts, adipocytes and chondroblasts. They also have a clear immunosuppressive and tissue regeneration potential. Indeed, the initial classification of MSCs as pluripotent stem cells, has turned into their identification as stromal progenitors. Due to the relatively simple procedures available to expand in vitro large numbers of GMP grade MSCs from a variety of different tissues, many clinical trials have tested their therapeutic potential in vivo. One pathological condition where MSCs have been quite extensively tested is steroid resistant (SR) graft versus host disease (GvHD), a devastating condition that may occur in acute or chronic form following allogeneic hematopoietic stem cell transplantation. The clinical and experimental results obtained have outlined a possible efficacy of MSCs, but unfortunately statistical significance in clinical studies has only rarely been reached and effects have been relatively limited in most cases. Nonetheless, the extremely complex pathogenetic mechanisms at the basis of GvHD, the fact that studies have been conducted often in patients who had been previously treated with multiple lines of therapy, the variable MSC doses and schedules administered in different trials, the lack of validated potency assays and clear biomarkers, the difference in MSC sources and production methods may have been major factors for this lack of clear efficacy in vivo. The heterogeneity of MSCs and their different stromal differentiation potential and biological activity may be better understood through more refined single cell sequencing and proteomic studies, where either an “anti-inflammatory” or a more “immunosuppressive” profile can be identified. We summarize the pathogenic mechanisms of acute and chronic GvHD and the role for MSCs. We suggest that systematic controlled clinical trials still need to be conducted in the most promising clinical settings, using better characterized cells and measuring efficacy with specific biomarkers, before strong conclusions can be drawn about the therapeutic potential of these cells in this context. The same analysis should be applied to other inflammatory, immune or degenerative diseases where MSCs may have a therapeutic potential.