Mesenchymal stem cells (MSC) have recently been used successfully in humans to control severe graft-versus-host disease. However, the mechanisms involved in their immunomodulatory effects remain a matter of debate. Here, we show that MSC are unable to activate allogeneic T cells even in the presence of T-cell growth factors. We then found that MSC inhibit T-cell proliferation triggered either by allogeneic, mitogenic or antigen-specific stimuli. Interestingly, MSC inhibit T-cell proliferation by inducing apoptosis of activated T cells, but have no effect on resting T cells. Furthermore, we show that this apoptosis could be related to the conversion of tryptophan into kynurenine by indoleamine 2,3-dioxygenase expressed by MSC in the presence of IFNgamma. Moreover, we show that the inhibitory effect of MSC is neither abrogated nor modified during expansion in culture or after irradiation. Together, these results bring new insight to the mechanisms of immunosuppression induced by MSC and might help to develop their clinical use controlling immune-related adverse effects in humans.