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To date, the wide application of cell-based biomaterials in tissue engineering and regeneration is remarkably hampered by immune rejection. Reducing the immunogenicity of cell-based biomaterials has become the latest direction in biomaterial research. Recently, genetically modified cell-based biomaterials with immunomodulatory genes have become a feasible solution to the immunogenicity problem. In this review, recent advances and future challenges of genetically modified immunomodulatory cell-based biomaterials are elaborated, including fabrication approaches, mechanisms of common immunomodulatory genes, application and, more importantly, current preclinical and clinical advances. The fabrication approaches can be categorized into commonly used (e.g., virus transfection) and newly developed approaches. The immunomodulatory mechanisms of representative genes involve complicated cell signaling pathways and metabolic activities. Wide application in curing multiple end-term diseases and replacing lifelong immunosuppressive therapy in multiple cell and organ transplantation models is demonstrated. Most significantly, practices of genetically modified organ transplantation have been conducted on brain-dead human decedent and even on living patients after a series of experiments on nonhuman primates. Nevertheless, uncertain biosecurity, nonspecific effects and overlooked personalization of current genetically modified immunomodulatory cell-based biomaterials are shortcomings that remain to be overcome. [Display omitted] • Cell-based biomaterials can be genetically modified with immunomodulatory genes. • Immunomodulatory genes help alleviate immune rejection of cell-based biomaterials. • Fabrication processes include common and newly developed methods. • Clinical/preclinical practices of gene-edited biomaterial transplantation. • Challenges: antigen elimination, systemic administration, individualization. [ABSTRACT FROM AUTHOR]