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Intervertebral disc degeneration is a major cause and a risk factor for chronic low back pain. The potential of using stem cells to treat disc degeneration has been raised. The aims of our study were to assess whether xenogeneic bone-marrow derived stem cells could survive in a rat disc degeneration model and to determine which cell types, if any, survived and differentiated into disc-like cells. Human bone-marrow derived CD34+ (hematopoietic progenitor cells) and CD34- (nonhematopoietic progenitor cells, including mesenchymal stem cells) cells were isolated, fluorescent-labeled, and injected into rat coccygeal discs. The rats were sacrificed at day 1, 10, 21, and 42. Treated discs were examined by histological and immunostaining techniques and compared to control discs. The survival of transplanted cells was further confirmed with a human nuclear specific marker. Fluorescent labeled CD34- cells were detected until day 42 in the nucleus pulposus of the injected discs. After 3 weeks these cells had differentiated into cells expressing chondrocytic phenotype (Collagen II and Sox-9). In contrast, the fluorescent labeled CD34+ cells could not be detected after day 21. No fluorescence-positive cells were detected in the noninjected control discs. Further, no inflammatory cells infiltrated the nucleus pulposus, even though these animals had not received immunosuppressive treatment. Our data provide evidence that transplanted human BM CD34- cells survived and differentiated within the relative immune privileged nucleus pulposus of intervertebral disc degeneration.