The transplantation of cultured stem and progenitor cells is a key element in the rapidly growing field of regenerative medicine. Based on their ability to rescue and/or repair injured tissue and partially restore organ function, multiple types of stem/progenitor cells have already entered into clinical trials. However, despite several decades of intense research, the goal to apply culture-expanded stem/progenitor cells in a manner that can effectively replace cells after injury has yet to be realized. Many sources of potentially useful cells are available, but something is clearly missing. In addition, recent studies suggest that paracrine effects of secreted or released factors are responsible for most of the benefits observed after cell transplantation, rather than direct cell replacement. These data call into question the need for cell transplantation for many types of therapy, in particular for acute injuries such as myocardial infarction and stroke. In this review, we examine current progress in the area of cell transplantation and minor issues and major hurdles regarding the clinical application of different cell types. We discuss the “paracrine hypothesis” for the action of transplanted stem/progenitor cells as an opportunity to identify defined combinations of biomolecules to rescue and/or repair tissues after injury. Although many of the concepts in this review will apply to multiple injury/repair systems, we will focus primarily on stem/progenitor cell-based treatments for neurological disorders and stroke. J. Cell. Biochem. 112: 374–380, 2011. © 2010 Wiley-Liss, Inc.