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Immune privileged mesenchymal stem cells (MSCs) can differentiate into multiple cell types and possess great potential for human and veterinary regenerative therapies. This study was designed with an objective to isolate, expand and characterize buffalo bone marrow-derived MSCs (BM-MSCs) at molecular and cellular level. Buffalo BM-MSCs were isolated by Ficoll density gradient method and cultured in Dulbecco’s modified Eagle’s medium supplemented with fetal bovine serum (FBS). These cells were characterized through alkaline phosphatase (AP) staining, colony-forming unit (CFU) assay, mRNA expression analysis (CD 73, CD 90, CD 105, Oct4 and Nanog), immunolocalization along with flow cytometry (Stro 1, CD 73, CD 105, Oct4, Sox2 and Nanog) and in situ hybridization (Oct4 and Sox2). Multilineage differentiation (osteogenic, adipogenic and chondrogenic) was induced in vitro, which was further assessed by specific staining. Buffalo BM-MSCs have the capacity to form plastic adherent clusters of fibroblast-like cells and were successfully maintained up to 16th passage. These cells were AP positive, and further CFU assay confirmed their clonogenic property. RT-PCR analysis and protein localization study showed that buffalo BM-MSCs are positive for various cell surface markers and pluripotency markers. Cytoplasmic distribution of mRNA for pluripotency markers in buffalo BM-MSCs and multilineage differentiation were induced in vitro, which was further assessed by specific staining. To the best of our knowledge, this is the first report of buffalo BM-MSCs, which suggests that MSCs can be derived and expanded from buffalo bone marrow and can be used after characterization as a novel agent for regenerative therapy.