Systemic lupus erythematosus (SLE) is a heterogeneous chronic multisystemic autoimmune inflammatory disorder. Autologous hematopoietic stem cell transplantation (HSCT) represents the first application of stem cell regenerative medicine in the treatment of drug-resistant SLE. The 5 year follow-up data showed that the overall survival was 84%, the probability of disease-free survival was 50% and treatment-related mortality was 4%. The European Group for Blood and Marrow Transplantation (EBMT) data showed that the 5 year overall survival was 81%±8% and disease-free survival was 29%±9%, with a non-relapse mortality of 15%±7%, suggesting a satisfactory clinical efficacy of autologous HSCT for lupus patients. However, The biggest challenge for HSCT is the high rate of disease relapse, as well as the serious side effects of the conditioning therapy. Mesenchymal stem cells (MSCs) are widely studied as an alternative cell source for their ability to differentiate into multiple mesenchymal lineages, as well as endoderm and neuroectoderm lineages. We have shown that bone marrow derived MSCs from SLE patients are defective structurally and functionally. Then from March 2007, we started to use allogeneic bone marrow and umbilical cord derived MSCs transplantation (MSCT) for refractory SLE patients, especially for those with drug resistant lupus nephritis. Allogenic MSCs were administered intravenously (one million cells per kilogram of bodyweight). The clinical manifestations and laboratory parameters were compared pre- and post-MSCT. During 4 years’ follow up, complete remission was 28% at 1 year (23/83), 31% at 2 years (12/39), 42% at 3 years (5/12) and 50% at 4 years (3/6). Rates of relapse were 12% (10/83) at 1 year, 18% (7/39) at 2 years, 17% (2/12) at 3 years and 17% (1/6) at 4 years. Disease activity declined shown by significant changes in SLEDAI score, proteinuria, renal function, and levels of serum autoimmune antibodies, albumin and complement C3. Furthermore, we observed a long-term tissue repair effect by MSCs transplantation in our patients. Importantly, doses of corticosteroid and immunosuppressant were tampered or discontinued after MSCT. Taken together, allogeneic MSCT exerts a profound therapeutic effect in patients with severe and refractory SLE.