Stem cells have been the focus of numerous investigations to treat diseases as far ranging as diabetes, chronic heart failure and multiple sclerosis over the past decade. The process of stem-cell-based repair of acute injury involves homing and engrafting of the stem cell of interest to the site of injury followed by either differentiation of the stem cell to indigenous end-organ cells or liberation of paracrine factors that lead to preservation and/or optimization of organ function. Recognition of the ability of stem cells to home to sites of acute injury suggests that, if appropriately defined and harnessed, stem cell homing could serve as a means of local drug delivery through the infusion of genetically engineering stem cells that secrete gene products of interest. The authors have recently demonstrated the use of this approach in preclinical studies of acute myocardial function. In addition, the use of engineered cells that home to appropriate niches have been used to correct genetic deficiency states (i.e., severe combined immunodeficiency, diabetes mellitus) in patients with otherwise chronic debilitating diseases. This review focuses on exploiting stem cell homing for gene transfer and on the state of the art and the challenges that face the field.