Contusive spinal cord injury (SCI) produces large fluid-, debris- and inflammatory cell-filled cystic cavities that lack structure to support significant axonal regeneration. The recent discovery of stem cells capable of generating central nervous system (CNS) tissues, coupled with success in neurotransplantation strategies, has renewed hope that repair and recovery from CNS trauma is possible. Based on results from several studies using bone marrow stromal cells (MSCs) to promote CNS repair, we transplanted MSCs into the rat SCI lesion cavity to further investigate their effects on functional recovery, lesion morphology, and axonal growth. We found that transplanted MSCs induced hindlimb airstepping--a spontaneous locomotor movement associated with activation of the stepping control circuitry--but did not alter the time course or extent of overground locomotor recovery. Using stereological techniques to describe spinal cord anatomy, we show that MSC transplants occupied the lesion cavity and were associated with preservation of host tissue and white matter (myelin), demonstrating that these cells exert neuroprotective effects. The tissue matrix formed by MSC grafts supported greater axonal growth than that found in specimens without grafts. Moreover, uniform random sampling of axon profiles revealed that the majority of neurites in MSC grafts were oriented with their long axis parallel to that of the spinal cord, suggesting longitudinally directed growth. Together, these studies support further investigation of marrow stromal cells as a potential SCI repair strategy.