hUCB-MSC (human umbilical cord blood-derived mesenchymal stem cells) offer an attractive alternative to bone marrow-derived MSC for cell-based therapy by being less invasive a source of biological material. We have evaluated the effect of hUCB-MSC on the proliferation of K562 (an erythromyeloblastoid cell line) and the cytokine secretion pattern of hUCB-MSC. Co-culturing of hUCB-MSC and K562 resulted in inhibition of proliferation of K562 in a dose-dependent manner. However, the anti-proliferative effect was reduced in transwells, suggesting the importance of direct cell-to-cell contact. hUCB-MSC inhibited proliferation of K562, arresting them in the G0/G1 phase. NO (nitric oxide) was not involved in the hUCB-MSC-mediated tumour suppression. The presence of IL-6 (interleukin 6) and IL-8 were obvious in the hUCB-MSC conditioned media, but no significant increase was found in 29 other cytokines. Th1 cytokines, IFNα (interferon α), Th2 cytokine IL-4 and Th17 cytokine, IL-17 were not secreted by hUCB-MSC. There was an increase in the number of hUCB-MSC expressing the latent membrane-bound form of TGFβ1 co-cultured with K562. The anti-proliferative effect of hUCB-MSC was due to arrest of the growth of K562 in the G0/G1 phase. The mechanisms underlying increased IL-6 and IL-8 secretion and LAP (latency-associated peptide; TGFβ1) by hUCB-MSC remains unknown.