Pulmonary emphysema is characterized by loss of alveolar structure. Bone marrow mesenchymal stem cells (MSCs) have been shown to differentiate into alveolar epithelial cells. However, the effect of MSCs transplantation on pulmonary emphysema is unknown. To address this question, cultured bone marrow MSCs from male donor rats were infused into female recipients treated with irradiation and instillation of papain. We found that the emphysematous changes in rats received MSCs transplantation were ameliorated when compared with the rats without MSCs transplantation. Y chromosome fluorescent in situ hybridization (FISH) and immunohistochemical staining for SP-C, confirmed that MSCs engrafted in recipient lungs and differentiated into type II alveolar epithelial cells. Additionally, MSCs transplantation reduced the extent of irradiation and papain-induced alveolar cell apoptosis, likely due to the up-regulation of the expression of Bcl-2 and Bax gene. We conclude that MSCs transplantation protects against the irradiation and papain-induced pulmonary emphysema. The mechanisms of protection may involve the engraftment of MSCs in the lungs, differentiation of MSCs into type II alveolar epithelial cells and suppression of alveolar cell apoptosis.