During the last decade, medical research has made immense progress in conquering many devastating diseases. Current neurotransplantation research focuses on the potential of neural grafts to replace damaged cell populations, the production of missing transmitters and neuroactive substances as well as on the delivery of growth factors such as BDNF, GDNF or NGF. The limited regenerative capacity of the adult central nervous system (CNS) remains a major stumbling block in the development of effective therapies for neurodegenerative diseases such as Parkinson’s disease, multiple sclerosis, Alzheimer’s disease or brain and spinal cord injury. Neural as well as non-neural stem cell (SC) therapy might overcome the low regenerative capacity in the human CNS. Embryonal stem cells (ESC) and bone marrow stromal cells (MSC) are pluripotent progenitor cells that have the capacity to migrate towards lesions and induce or facilitate site-dependent differentiation in response to environmental signals. In our studies, we examined the behavior of mouse ESC and rat or human MSC grafted to injured rat brain and spinal cord. We studied whether these cells are capable of survival and if they participate in lesion repair, differentiate into neurons and astrocytes, prevent scar formation or promote neurogenesis. The migration and fate of ESC and MSC were studied using cells labeled in culture with magnetic iron-oxide nanoparticles. The cells were transplanted into adult rats with a cortical photochemical lesion or a balloon-induced spinal cord lesion. In vivo MR imaging was used to track cells; electron microscopy and Prussian blue staining confirmed the presence of nanoparticles inside the cells. SC labeled with nanoparticles preferentially migrated into the lesion. In the case of MSC, only a few of the cells that entered the lesion expressed the neuronal marker NeuN and even fewer GFAP-positive cells were detected. There was no significant difference in the number of MSC entering the lesion between animals directly injected in the cortex or spinal cord and those systemically infused. We found that the intravenous injection of MSC 24 hours after spinal cord injury improved the behavioral outcome of the animals (BBB score and plantar test) starting at 4 weeks after implantation, presumably by the production of regeneration-promoting factors as yet unknown. The implantation of biocompatible polymer hydrogels can reduce scar tissue formation and bridge a lesion, providing a scaffold to reform the tissue structure. We implanted blocks of biodegradable hydrogels based on copolymers of 2-hydroxypropylmethacrylamide with ethoxyethylmethacrylate into rats with hemisected spinal cords. We used hydrogels with in vitro degradation times of 7, 13 or 35 days as well as control nondegradable hydrogels. The animals were sacrificed 28 days after implantation. Both the nonbiodegradable and biodegradable hydrogels were biocompatible and adhered well to the host tissue, bridging the whole spinal cord lesion; with the nondegradable hydrogels, tissue adhesion was less pronounced. All biodegradable hydrogels degraded from the border that was in direct contact with the spinal cord tissue. They were resorbed by macrophages and replaced by newly formed tissue containing connective tissue elements, blood vessels, astrocytic processes and neurofilaments. These gels were further used as 3D carriers for MSC and implanted into rats with spinal cord injury. Our study shows that biodegradable polymer hydrogels are promising candidates for bridging gaps in the central nervous tissue. These hydrogels are in many ways similar to the environment in developing nervous tissue and can mechanically support ingrowing cells and axons. Their chemical and physical properties can be tailored to a specific use, and in the future they may be used in human medicine as 3D carriers for stem cell implantation. Our clinical study in patients with transversal spinal cord lesions is based on the above experimental results. MSC implantation is being used in a Phase I clinical trial in patients with transversal spinal cord lesions (n=20). We compared intra-arterial vs. intravenous administration and a group of acute (10-30 days post-injury) vs. chronic patients. We can conclude that implantation is safe, as there were no complications following MSC administration. We are using MEP, SEP, MRI and the ASIA score in our patient follow-up. Although improvement of motor and sensory functions has been observed below the lesion site, further trials involving a much larger population of patients are needed before any conclusions can be drawn. These studies demonstrate the immense potential of SC as a therapeutic tool in the treatment of injury and degenerative diseases. It is evident that there may be various ways in which SC may interact with the host CNS tissue.