BACKGROUND Hematopoietic stem cells located in the bone marrow interact with a specific microenvironment referred to as the stem cell niche. Data derived from ex vivo co-culture systems using mesenchymal stromal cells as a feeder cell layer suggest that cell-to-cell contact has a significant impact on the expansion, migratory potential and 'stemness' of hematopoietic stem cells. Here we investigated in detail the spatial relationship between hematopoietic stem cells and mesenchymal stromal cells during ex vivo expansion. METHODS In the co-culture system, we defined three distinct localizations of hematopoietic stem cells relative to the mesenchymal stromal cell layer: (i) those in supernatant (non-adherent cells); (ii) those adhering to the surface of mesenchymal stromal cells (phase-bright cells) and (iii) those beneath the mesenchymal stromal cells (phase-dim cells). Cell cycle, proliferation, cell division and immunophenotype of these three cell fractions were evaluated from day 1 to 7. RESULTS Phase-bright cells contained the highest proportion of cycling progenitors during co-culture. In contrast, phase-dim cells divided much more slowly and retained a more immature phenotype compared to the other cell fractions. The phase-dim compartment was soon enriched for CD34(+)/CD38(-) cells. Migration beneath the mesenchymal stromal cell layer could be hampered by inhibiting integrin beta1 or CXCR4. CONCLUSIONS Our data suggest that the mesenchymal stromal cell surface is the predominant site of proliferation of hematopoietic stem cells, whereas the compartment beneath the mesenchymal stromal cell layer seems to mimic the stem cell niche for more immature cells. The SDF-1/CXCR4 interaction and integrin-mediated cell adhesion play important roles in the distribution of hematopoietic stem cells in the co-culture system.