Several groups have suggested that transplantation of marrow stromal cells (MSCs) promotes functional recovery in animal models of brain trauma. Recent studies indicate that tissue replacement by this method may not be the main source of therapeutic benefit, as transplanted MSCs have only limited ability to replace injured central nervous system (CNS) tissue. To gain insight into the mechanisms responsible for such effects, we systematically investigated the therapeutic potential of MSCs for treatment of brain injury. Using in vitro studies, we detected the synthesis of various growth factors, including nerve growth factor (NGF), brain-derived neurotrophic factor (BDNF), glial cell line-derived neurotrophic factor (GDNF), and neurotrophin-3 (NT-3). Enzyme-linked immunosorbent assay (ELISA) demonstrated that MSCs cultured in Dulbecco's modified Eagle medium (DMEM) produced substantial amounts of NGF for at least 7 weeks, whereas the levels of BDNF, GDNF and NT-3 remained unchanged. In studies in mice, after intraventricular injection of MSCs, NGF levels were increased significantly in cerebrospinal fluid by ELISA, confirming our cell culture results. Further studies showed that treatment of traumatic brain injury with MSCs could attenuate the loss of cholinergic neuronal immunostaining in the medial septum of mice. These studies demonstrate for the first time that by increasing the brain concentration of NGF, intraventricularly transplanted MSCs might play an important role in the treatment of traumatic brain injury. © 2005 Wiley-Liss, Inc.