Mesenchymal stem cells (MSCs) are multipotent progenitor cells representing an attractive therapeutic tool for regenerative medicine. They possess unique immunomodulatory properties, being capable of suppressing T-cell responses and modifying dendritic cell differentiation, maturation, and function, whereas they are not inherently immunogenic, failing to induce alloreactivity to T cells and freshly isolated natural killer (NK) cells. To clarify the generation of host immune responses to implanted MSCs in tissue engineering and their potential use as immunosuppressive elements, the effect of MSCs on NK cells was investigated. We demonstrate that at low NK-to-MSC ratios, MSCs alter the phenotype of NK cells and suppress proliferation, cytokine secretion, and cyto-toxicity against HLA-class I– expressing targets. Some of these effects require cell-to-cell contact, whereas others are mediated by soluble factors, including transforming growth factor–β1 and prostaglandin E2, suggesting the existence of diverse mechanisms for MSC-mediated NK-cell suppression. On the other hand, MSCs are susceptible to lysis by activated NK cells. Overall, these data improve our knowledge of interactions between MSCs and NK cells and consequently of their effect on innate immune responses and their contribution to the regulation of adaptive immunity, graft rejection, and cancer immunotherapy.