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Mesenchymal stem cells (MSCs) are multipotent stem cells, whose paracrine and immunomodulatory potential has made them a promising candidate for central nervous system (CNS) regeneration. Numerous studies have demonstrated that MSCs can promote immunomodulation, anti-apoptosis, and axon re-extension, which restore functional neural circuits. The therapeutic effects of MSCs have consequently been evaluated for application in various CNS diseases including spinal cord injury, cerebral ischemia, and neurodegenerative disease. In this review, we will focus on the research works published in the field of mechanisms and therapeutic effects of MSCs in CNS regeneration.