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Mesenchymal stromal cells (MSCs) are perivascular multipotent stem cells originally identified in the bone marrow (BM) stroma and subsequently in virtually all vascularized tissues. Because of their ability to differentiate into various mesodermal lineages, their trophic properties, homing capacity, and immunomodulatory functions, MSCs have emerged as attractive candidates in tissue repair and treatment of autoimmune disorders. Accumulating evidence suggests that the beneficial effects of MSCs may be primarily mediated via a number of paracrine-acting soluble factors and extracellular vesicles (EVs). EVs are membrane-coated vesicles that are increasingly being acknowledged as playing a key role in intercellular communication via their capacity to carry and deliver their cargo, consisting of proteins, nucleic acids, and lipids to recipient cells. MSC-EVs recapitulate the functions of the cells they originate, including immunoregulatory effects but do not seem to be associated with the limitations and concerns of cell-based therapies, thereby emerging as an appealing alternative therapeutic option in immune-mediated disorders. In the present review, the biology of MSCs will be outlined and an overview of their immunomodulatory functions will be provided. In addition, current knowledge on the features of MSC-EVs and their immunoregulatory potential will be summarized. Finally, therapeutic applications of MSCs and MSC-EVs in autoimmune disorders will be discussed. [ABSTRACT FROM AUTHOR]