Chronic obstructive pulmonary disease (COPD) is the most frequent chronic respiratory disease and a leading cause of morbidity and mortality, worldwide. Given that the foremost risk factor leading to the development of COPD is cigarette smoke, the initial treatment for COPD is smoking cessation. Even after smoking cessation, inflammation, apoptosis and oxidative stress can persist and continue to contribute to COPD. Although current therapies for COPD (which are primarily based on anti-inflammatory drugs such as corticosteroids, theophylline and bronchodilators) reduce airway obstruction, limit COPD exacerbation and improve the patient’s health-related quality-of-life, none can prevent disease progression or reduce mortality. Recent advances in stem cell research have provided novel insight into the potential of bone marrow mesenchymal stem cells (MSCs) in the treatment of several pulmonary diseases. This review article discusses the biological effects and mechanisms of action of MSC transplantation in COPD, and highlights the foundation that MSCs provide for novel therapeutic approaches in COPD.