First isolated from bone marrow, mesenchymal stem or stromal cells (MSC) were shown to be present in several postnatal and extraembryonic tissues as well as in a large variety of fetal tissues (e.g., fatty tissue, dental pulp, placenta, umbilical cord blood, and tissue). In this study, an optimized protocol for the expansion of MSC-like cells from whole umbilical cord tissue under xeno-free culture conditions is proposed. Different fetal calf sera and human serum (HS) were compared with regard to cell proliferation and MSC marker stability in long-term expansion experiments, and HS was shown to support optimal growth conditions. Additionally, the optimal concentration of HS during the cultivation was determined. With regard to cell proliferative potential, apoptosis, colony-forming unit fibroblast frequency, and cell senescence, our findings suggest that an efficient expansion of the cells is carried out best in media supplemented with 10% HS. Under our given xeno-free culture conditions, MSC-like cells were found to display in vitro immunoprivileged and immunomodulatory properties, which were assessed by co-culture and transwell culture experiments with carboxyfluorescein diacetate succinimidyl ester-labeled peripheral blood mononuclear cells. These findings may be of great value for the establishment of biotechnological protocols for the delivery of sufficient cell numbers of high quality for regenerative medicine purposes.