Human mesenchymal stromal cells (hMSCs) were injected into the hippocampus of adult mice 1 day after transient global ischemia. The hMSCs both improved neurologic function and markedly decreased neuronal cell death of the hippocampus. Microarray assays indicated that ischemia up-regulated 586 mouse genes. The hMSCs persisted for <7 days, but they down-regulated >10% of the ischemia-induced genes, most of which were involved in inflammatory and immune responses. The hMSCs also up-regulated three mouse genes, including the neuroprotective gene Ym1 that is expressed by activated microglia/macrophages. In addition, the transcriptomes of the hMSC changed with up-regulation of 170 human genes and down-regulation of 54 human genes. Protein assays of the hippocampus demonstrated increased expression in microglia/macrophages of Ym1, the cell survival factor insulin-like growth factor 1, galectin-3, cytokines reflective of a type 2 T cell immune bias, and the major histocompatibility complex II. The observed beneficial effects of hMSCs were largely explained by their modulation of inflammatory and immune responses, apparently by alternative activation of microglia and/or macrophages.