The causes of bone marrow failure in aplastic anemia are notreadily identified in the majority of cases. Stem cell abnormalities,stromal microenvironment dysfunction and immune-mediated defects arefeatures identified following diagnosis of aplastic anemia, either singly orin combination. It is generally appreciated that bone marrowmicroenvironment consists of adipocytes, fibroblasts, osteoblastsosteoclasts and endothelial cells, all derived from MSCs, which supporthematopoiesis & regulate almost overall immune cell function. Recentstudies showed that the differentiation capacity of MSCs was aberrant inacquired AA. MSCs were more readily induced to differentiate intoadipocytes but less readily and slower into osteoblasts. Also MSCsfrom patients with AA had poor proliferation potential and deficientsupport of hematopoietic colony-forming activity. MSCs in the bonemarrow of acquired AA show the defect of hematopoietic stem-cell nicheincluding osteoblastic and vascular niche. The damaged niche mayalso be hard to maintain a quiescent state and an immune balance becauseof immunosuppressive deficiency of over-activated T cells and limitedpromotion to T regulatory cells. As a result, abnormal immunity destroysHSCs/HPCs functions to develop to hypoplasia and pancytopenia.Better understanding of the pathophysiology of SAA will lead todevelopment of novel treatment modalities and the administration ofnormal MSC in vivo to patients with SAA may be one additionalpotential treatment either alone or in combination with HSCs.