Mesenchymal stem cells (MSCs) exert suppressive effects in several disease models including lupus prone mice. However, autologous MSC therapy has not been tested in human systemic lupus erythematosus (SLE). We evaluate the safety and efficacy of bone marrow (BM)-derived MSCs in two SLE patients; the suppressor effect of these cells in-vitro and the change in CD4+CD25+FoxP3+ T regulatory (Treg) cells in response to treatment. Two females (JQ and SA) of 19 and 25 years of age, fulfilling the 1997 American College of Rheumatology (ACR) criteria for SLE were infused with autologous BM-derived MSCs. Disease activity indexes and immunological parameters were assessed at baseline, 1, 2, 7 and 14 weeks. Peripheral blood lymphocyte (PBL) subsets and Treg cells were quantitated by flow cytometry, and MSCs tested for in-vitro suppression of activation and proliferation of normal PBLs. No adverse effects or change in disease activity indexes were noted during 14 weeks of follow-up, although circulating Treg cells increased markedly. Patient MSCs effectively suppressed in-vitro PBL function. However, JQ developed overt renal disease 4 months after infusion. MSC infusion was without adverse effects, but did not modify initial disease activity in spite of increasing CD4+CD25+FoxP3+ cell counts. One patient subsequently had a renal flare. We speculate that the suppressive effects of MSC-induced Treg cells might be dependent on a more inflammatory milieu, becoming clinically evident in patients with higher degrees of disease activity.