The prognosis of patients with malignant glioma is extremely poor, despite the extensive surgical treatment that they receive and recent improvements in adjuvant radio- and chemotherapy. In the present study, we propose the use of gene-modified mesenchymal stem cells (MSCs) as a new tool for gene therapy of malignant brain neoplasms. Primary MSCs isolated from Fischer 344 rats possessed excellent migratory ability and exerted inhibitory effects on the proliferation of 9L glioma cell in vitro. We also confirmed the migratory capacity of MSCs in vivo and showed that when they were inoculated into the contralateral hemisphere, they migrated towards 9L glioma cells through the corpus callosum. MSCs implanted directly into the tumor localized mainly at the border between the 9L tumor cells and normal brain parenchyma, and also infiltrated into the tumor bed. Intratumoral injection of MSCs caused significant inhibition of 9L tumor growth and increased the survival of 9L glioma-bearing rats. Gene-modification of MSCs by infection with an adenoviral vector encoding human interleukin-2 (IL-2) clearly augmented the antitumor effect and further prolonged the survival of tumor-bearing rats. Thus, gene therapy employing MSCs as a targeting vehicle would be promising as a new therapeutic approach for refractory brain tumor.