Umbilical cord-derived mesenchymal stem cell transplantation (UC-MSCT) has been proved to be effective in the treatment of systemic lupus erythematosus (SLE), based on animal experiments and clinical trials. Diffuse alveolar hemorrhage (DAH) is a rare complication of SLE with a high mortality usually over 50%. This study aimed to assess the efficacy of UC-MSCT in the treatment of SLE-associated DAH. Four SLE patients complicated with DAH, who underwent UC-MSCT, were included. Clinical changes before and after transplantation were assessed by measurements of hemoglobin, platelet level, oxygen saturation, and serological factors. High-resolution CT (HRCT) scans of the chest were performed to evaluate pulmonary manifestation. All the four patients showed dramatic improvements of their clinical manifestations. Hemoglobin was elevated after UC-MSCT and was sustained at a normal level 6 months after UC-MSCT in the four patients. Platelet level was upregulated in two patients who had thrombocytopenia at baseline. Oxygen saturation appeared to be normal at 1 month after UC-MSCT, and this result was confirmed by the HRCT scan of the chest. Serum albumin elevated to 3.5 g/dl 6 months after transplantation. Our findings suggest that UC-MSCT results in amelioration of oxygen saturation as well as hematological and serologic changes, which revealed that UC-MSCT could be applied as a salvage strategy for DAH patients.